Could Apple Fall Back to $500?

The following video is part of our "Motley Fool Conversations" series, in which Chief Technology Officer Jeremy Phillips and senior technology analyst Eric Bleeker discuss topics around the investing world.

Markets were on the rise today, but the overall move in the past month has been steeply to the negative. Europe is crumbling, and instability reigns. In this video, Eric looks at the downside scenario for Apple if the Europe situation continues to worsen. A move back to $500 would be about an 11% fall from Friday's close. That's not an implausible scenario if broader markets are falling. Apple is up 39% on the year, and stocks with the most momentum are often sold off the worst in steep market retrenchments. The company gets about 25% of its sales from Europe, so Apple definitely has exposure to the continent. Worse yet, any protracted instability could further push carriers to cut subsidies on phones, especially in peripheral countries. However, Eric notes what an amazing value Apple would be looking ahead to next year at $500, eclipsing the cheapness of go-to tech value plays like Cisco and Microsoft. To see Eric's full analysis, watch the following video. 

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Eric Bleeker owns shares of Cisco Systems. Jeremy Phillips has no positions in the stocks mentioned above. The Motley Fool owns shares of Apple and Microsoft. Motley Fool newsletter services recommend Apple and Microsoft. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.


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