This column originally appeared on Real Money Pro at 11:26 a.m. EST on Feb. 6.
The shares are down from $700 a share to $430 a share based on a confluence of sentiment, supply/demand, technical and fundamental factors:
- The Apple shareholder base turned out to be more transitory and more relative-price-driven than many thought.
- As the stock turned lower, there turned out to be more renters than owners.
- As the stock turned even lower, fund flows turned dramatically.
- Stated simply, Apple's share price morphed from the NBA (nothing but Apple) market to the ABA (anything but Apple) market.
- All the while, the competitive landscape was eroding -- my bear case in September 2012 centered on this argument.
- At first, the second-quarter 2012 earnings miss (which was an outgrowth of greater competition) was ignored because the relative and absolute share price action was so strong.
- As investors refocused on fundamentals, however, the stock price dropped to the current levels (reality bites).
- Predictably, previously bullish Wall Street analysts have turned negative on the shares.
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