Apple shares have dropped more than 20 percent from their peak in recent weeks, causing many to wonder if Apple's recent executive shake-up, new products or the economy have ended Wall Street's confidence in the tech company.
Apple shares dropped another 2 percent on Thursday morning and the fall was actually faster than the rest of the market, according to the New York Times. In essence, investors are worried about consumer demand and taxes after the re-election of President Barack Obama.
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Obama has proposed increasing capital gains tax rates for people earning more $250,000 to 20 percent from 15 percent, and his re-election may have caused some shareholders to unload their stock to stay ahead of the possible tax increase. Apple shares have risen steadily since 2005 when they were only $35 each. (They're now $542.48 at this writing.)
However, with the recent revamp of products, with some saying the new iPad Mini will cannibalize other iPad sales, some analysts are not expecting high profit margins. Then there was the quick and dirty reorganization of Apple executives, which sunk share prices.
“It has just been wave after wave of bad news,” Gene Munster, an analyst at Piper Jaffray, said.
Wall Street is notoriously high-strung, and if there's any hint a company isn't going swimmingly its shares fall quickly. Some could argue that with Apple's long love affair with Wall Street had to end sometime, but we think it's likely a minor setback. They will probably get back together again.