This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

AAPL Could Burn Emotional Investors

Stocks in this article: AAPL BBRY GOOG

NEW YORK ( TheStreet) -- Around this time last year, I was writing for Seeking Alpha. Readers lambasted me for Apple Bulls Are Wrong About The Impact Of A New CEO.

Apple (AAPL) bulls not only ripped me, they got dangerously emotional in the process.

During late March 2012, AAPL longs were all over Twitter rallying the troops against even a sniff of bearishness with Tweets such as: I'm expecting 50 trailing EPS when $AAPL reports Jan '13. Multiply by P/E expansion to 18 = PT 900. Ip5 frenzy could mean 1K/share. #GetIn, Portfolio now 90% $AAPL calls and bull call spreads going into April earnings. 600 was defended today, onward to 610 and Let's go 620 u can do it.

Those representative war cries come from late March 2012. There was still plenty of upside left in AAPL on the way to $700 so, in theory, that flavor of bull could have done quite well with the stock, even via options. Or they could have become even more confident, doubled down on calls and ended up one of the many who combined to lose millions upon millions as AAPL started to fall.

Because, when a battleground stock like AAPL starts to drop, many bulls not only double down, they start using emotionally charged words such as "defended," shouting cheers and making up inane price targets. They feel the need to follow through with the type of loyalty your grandfather expects you to show your country. It becomes a matter of personal and "national" pride. It's about as effective vis-à-vis real world outcomes as yelling at your television screen during a sporting event.

I sense this type of money-losing behavior rearing its head again. If you're Doug Kass, it's one thing to trade in and out of AAPL. If you can do that, more power to you. But, most of us lack the ability.

AAPL's up a few percent over the last week. On Tuesday, it tapped past $460 intraday. There's optimism once again from folks calling "the bottom" and recalculating price targets. There's this air that Samsung's joke of a smartphone launch reaffirms Apple's continued dominance. To a certain extent, I agree. The feeling bubbles under the surface that even if BlackBerry (BBRY) sees real success with the new "Zed 10," it won't make a big enough dent in Apple's mindshare or Android's marketshare to matter to Apple, Samsung or Google (GOOG). Again, I pretty much agree.

However, this does not remove the elephant from the room. It does not change the fact that the real reason AAPL turned up is because of chatter around a possible dividend-related move. How bad have things become when talk of an increased or special dividend is what we need to push AAPL higher?

1 of 2

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!

Markets

DOW 17,804.80 +26.65 0.15%
S&P 500 2,070.65 +9.42 0.46%
NASDAQ 4,765.38 +16.9840 0.36%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs