Weak iPhone demand rumors put the hurt on Apple stock


Apple stock is suffering right now.
Photo: Ste Smith/Cult of Mac

Apple stock has continued to slide in the wake of negative stories about iPhone order numbers. AAPL shares lost up 2 percent in premarket trading.

At time of writing, they are valued at $193.53 per share. That’s down from the $232.07 Apple hit in early October, back when the company was comfortably valued at over $1 trillion.

Apple’s stock dipped into correction territory last week. This was based on a number of reports claiming that the iPhone XS and XR may have had their orders cut significantly by Apple. Multiple analysts — such as those at Guggenheim, UBS, and others — have downgraded Apple stock or lowered their 12-month price targets.

As we noted last week, Apple has lost more money in the past 5 weeks — $190 billion — than its accumulated total value in the first 30 years of its life as a publicly traded company.

No, it’s not all bad news

Not everything is necessarily bad news, of course. No, it’s not ideal for Apple to be hit with reports suggesting lower demand for its iPhones. But even if they do turn out to be accurate (and remember that similar — incorrect — reports circulated last year about the iPhone X), Apple’s hardly struggling.

To protect against the global slowdown in smartphones, it’s raised the average sale price of the iPhone. This means that it doesn’t need to sell so many handsets to make the same amount of profit.

Other parts of Apple’s business are also growing rapidly. Most prominent of these is the Services division, which is now bigger than Apple’s individual Apple Watch, iPad and Mac businesses. Previously, analyst Katy Huberty described Services as, “fast becoming Apple’s primary growth driver.”

With Apple now arguably under-valued, as my colleague Ed Hardy recently wrote, this may just be the absolute best time to buy AAPL stock.

Source: CNBC