Apple has been treading lightly with Wall Street in recent months. The company’s stock has continued to nosedive despite reporting record earnings for the last quarter. Many investors have been urging Apple to do something with its $137 billion cash hoard. Shareholders want a return on their investments.
Greenlight Capital, a prominent and influential Apple investor, has called Apple out for its proposal to eliminate preferred stock. Apple started paying a quarterly dividend of $2.65 per share last year, but investors want something more substantial. Greenlight Capital’s David Einhorn believes that “preferred shares would be a way to reward investors without putting the company at risk.”
Apple has officially responded with a press release:
Apple stock opened at $457.70 this morning, down more than 10%, following its financial results on Wednesday. The Cupertino company announced $13.1 billion profit for the first quarter of 2013, a slight increase over the $13.06 billion it posted for the first quarter of 2012. But despite that increase, it’s clear Apple’s phenomenal growth has hit a stumbling block.
Apple will announce its quarterly earnings for the 2012 holiday season tomorrow, and investors are nervous. The company’s stock has been on quite the roller coaster ride since its $700 high back in September 2012. AAPL is now trading right around $500, which is the lowest it has been in more than six months.
Recent reports have said that demand for products like the iPhone is faltering. That’s why it may come as a surprise that Wall Street expects Apple to have its best earnings report ever tomorrow. So is it a good time to sell AAPL? Now may actually be the best time to buy.
On the evening of Apple’s latest earnings call, David Miller, a 40 year old trader at Rochdale Securities LLC, had a great idea. Apple stock price always goes up after an earnings call, right? So what he would do is buy 1.6 million shares of Apple stock worth over $1 billion, then “flip” them the next morning when the stocks rose, pocketing a personal profit of millions of dollars.
A fine plan, don’t you think? There was only one problem: Apple stock actually went down the morning after the latest earnings call. Now Miller is facing 20 years in federal prison for wire fraud, and his trading company might be going under.
You might have heard that Apple is set to unveil a new iPhone tomorrow. Wall Street certainly has, and analysts have been predicting how many units Apple will sell out of the gate. Anticipation for the iPhone 5 is ridiculously high, and Apple is expected to shatter the records it set with the 4S last year.
While estimates vary, the general consensus is that Apple will sell between 8-10 million iPhone 5s in September, which would be huge for Apple’s last fiscal 2012 quarter.
Before his tragic and untimely death last October, Steve Jobs’s chronic health issues were such a constant concern for investors that they arguably kept the stock price of the company artificially low for years, as Wall Street worried that the company would tank without its charismatic leader at the helm.
Obviously, that hasn’t happened. In fact, since Jobs’s death, Apple’s share price has soared to new highs. As sad as it is to say, in some ways, Jobs’s death finally liberated the stock from the hyperbolic threat of his death, and allowed investors to finally appraise the company as it actually is: the best on Earth, even without Steve, because he made it that way.
But Wall Street never learns. Since Google CEO Larry Page called in sick to last week’s annual meeting, investors are panicking.
In the last two weeks, Apple’s share price has plummeted over $60 from its all-time high ahead of reports suggesting that iPhone growth was stalling at domestic carriers. Today, though, Apple has again hurtled past the $600 barrier in after hours trading after Cupertino announced yet another record breaking quarter.
Looks like we can look forward to another three months of stock growth, until the next silly pre-earnings call investor scare.
One analyst believes Apple may not report the same results Wall Street has predicted, but they'll still be pretty great.
Apple CEO Tim Cook will announce the company’s second-quarter earnings on April 24, and according to one analyst, it will report sales of 33 million iPhone, 12 million iPads, and 4.3 million Macs. Sounds like another great quarter, but those predictions are, on the whole, a little less than Wall Street is anticipating.
Conventional wisdom on Wall Street has it that eventually (and possibly as soon as the end of this year) Apple’s stock price will reach over $1000 a share, largely fueled by the iPhone. But one Wall Street analyst isn’t nearly so optimistic. In fact, BTIG Research analyst Walter Piecyck is downgrading his recommendation on Apple stock from “Buy” to “Neutral…” and his reasons actually make a lot of sense.
![Carriers May Soon Revolt Against The iPhone [Analyst]](http://cdn.cultofmac.com/wp-content/uploads/2012/04/nyse.jpg "nyse")
