Apple Discounts TV but Who's Buying the Stock?

NEW YORK (TheStreet) - Apple (AAPL) is discounting its Apple-TV, a rare event that could translate into a catalyst for a stock that has under performed this year.

Shares are down 6.2% in 2014, closing Friday at $526.24, but Apple's discount on Apple TVs purchased from now until March 5, suggests the company may be poised to release its next generation of the television streaming device. The discount, by the way, includes a chance to get a $25 iTunes gift card.

Apple TV buyers may also be rewarded for waiting for the next generation product. It's unusual for Apple to discount anything, and if the company is about to release the next generation TV, it may need the room in the warehouse.

It's hard to imagine apple is having inventory issues, especially in light of the promotion localized to the U.S. With that said, if Apple doesn't release a new TV relatively soon, the gift card may mean soft sales and lower revenue / margins (because of discounting). It's reasonable to assume we should expect an announcement of the newest TV.

Second, if the company does release a next generation TV anytime soon, the positive media attention should be a catalyst for a move higher. A 2-5% lift as a result of renewed enthusiasm for the product is probable, especially with the shrinking float as a result of share buybacks.

If you're a long-term investor, I wouldn't become focused on the daily chart if you watch it at all. 

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