Tech stocks in general have not enjoyed much appreciation from Wall Street in 2011, but Apple, a long-time favorite in the group, has had an unusually rough ride. June has been particularly hard for the tech giant, whose shares are down 8% so far this month.
Traders and analysts describe a laundry list of explanations for why dumping Apple by the bushel has been so prevalent.
As one hedge fund manager described it, Apple is suffering from being the "best house in a bad neighborhood." With phone rivals
Research In Motion
in crisis, and
failing to gain traction, the sector hasn't been exactly the sweetest spot in the market.
And even though Apple's iPhone success has been a big cause of its peers' woes, investors aren't feeling confident that the winning streak will continue.
Apple shares, after falling 2% Monday, regained that ground and more Tuesday up $8.59, or 3%, to $323.91 by midday.
Here are some of the highlights from the checklist of bearish themes on Apple.
Product VacuumOppenheimer is the latest shop Tuesday to warn that the next iPhone will be later than expected. And as first reported by TheStreet, the upgrade this year is minor with the fully-powered 4G LTE iPhone in development for next year.
It's the EconomyThe U.S. may or may not be in a double-dip recession and Greece's debt continues weigh heavily on European economies. "I believe investors are scared of a European recession," said MKM Partners Tero Kuittinen, who points to a slowdown in first-quarter phone sales in Europe.
It's TechnicalSome technical analysts have studied Apple's charts and found that the stock has fallen through key support levels. For these chartists, the patterns point to continued drops until the stock reaches a price where buyers have been willing to move in before.
Google's AndroidWhile Apple has been selling year-old weakling iPhones, Google Androids have muscled-up with dual-core processors and 4G LTE wireless connections. "The Android camp had a huge May in Europe -- Samsung in particular is coming back in a big way, threatening to undercut the aging iPhone over summer months," said Kuittinen.
Facebook AppsApple's iron grip on iPhone and iPad apps may have been broken with Facebook's development of its own Web-based programs. Buying Facebook apps from Facebook using an iPhone threatens to remove Apple from the transaction.
J.C. Penney's GainApple's retail brainiac Ron Johnson is off to turn J.C. Penney's business around as its new CEO in November. The departure could threaten the continued success of Apple's retail unit, which boasts $3.2 billion in annual sales and 90% growth.
Steve JobsApple's CEO is on his third medical leave since his bout with pancreatic cancer, but, as he proved earlier this month at Apple's developers' conference, Jobs is still very much around. This proved once more that Jobs, the inspiration behind Apple, remains both ill and irreplaceable.
De-RiskingFearing those great Apple gains over the years could vanish, investors are cashing in their positions and banking their proceeds. Given the uncertainties of the market, and how strong Apple has been, people aren't eager to risk it. "It's a crowded long," said the hedge fund manager who refused to be named, referring to the potential backlash of a momentum stock that so many investors piled into.
--Written by Scott Moritz in New York.To contact this writer, click here: Scott Moritz, or email: firstname.lastname@example.org.Follow Scott on Twitter at MoritzDispatch