This Day On The Street
Continue to site
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

Wrong Calls: Intel, America Online and Apple

NEW YORK (TheStreet) -- There have been many wrong calls made by CEOs, analysts and investors over the past 20 years. But the three I remember as the absolute worst calls were the boom in Intel (INTC - Get Report) in the mid-1990s, the America Online (AOL) purchase of Time Warner (TWX) in January 2000, and, most recently, the $1,000 price target for Apple (AAPL) in 2012 as the stock approached $700 a share.

As the new millennium began and the tech bubble was inflating, both Intel and AOL were considered by many to be "key to the market" stocks.

Intel Kicked Outside

Intel really took off beginning in 1991, with the "Intel inside" campaign. Nearly 200 other equipment manufacturers engraved or stamped that emblem on the devices they made with Intel microprocessors inside.

As the Intel hype evolved and the stock traded higher, this advertising campaign implied that consumers should only buy devices with "Intel inside" logo as a seal of approval. As Intel became a household name, the stock was selected to be a member of the Dow Jones Industrial Average on Nov. 1, 1999. I remember how I concluded that Intel was the key to the market, with the stock already in the S&P 500 and the Nasdaq.

The Intel bubble popped from above $75 a share in the second half of 2000. Since then it has been trading back and forth around its 200-week simple moving average, now at $22.83.

AOL Crash

Must Read: Inflating Market Bubble Not Quite Ready to Pop

I had been a subscriber to America Online way before the company's stunning announcement that it would buy Time Warner back on Jan. 10, 2000. Analysts called this merger the most significant development in the emerging world of the Internet. Wrong call!

During the 12 months before this deal, AOL stock traded as high as $95.81. But that isn't the same AOL stock of today. The merger was such a bad call that the AOL Time Warner board of directors removed AOL from the company name in September 2003, and also changed its symbol back to the old Time Warner symbol, TWX.

Although it was so popular before the merger, AOL became the unwanted brand. The two companies split again in the fourth quarter of 2009. Eventually AOL began a turnaround in the third quarter of 2011. I still use AOL today and believe that their products, services and content are superb.

1 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

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
Stocks Under $10

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

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

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
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
AOL $0.00 0.00%
APPL $0.00 0.00%
INTC $34.45 0.26%
AAPL $118.03 -0.71%
FB $105.41 -0.31%


Chart of I:DJI
DOW 17,813.39 +1.20 0.01%
S&P 500 2,088.87 -0.27 -0.01%
NASDAQ 5,116.1430 +13.3350 0.26%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs