Could Apple Fall to $300 This Year?

In this video, Motley Fool analyst Andrew Tonner focuses on Apple's current situation. The share price has been on the decline and is already below the $400 mark, marking a 45% drop from last September.

A lot of investors now wonder whether the stock will hit the $300 mark soon. Andrew doesn't think so. Looking at Apple's upcoming earnings report, he sees that even though the company might show a decline in revenue and market share, it's also expecting a 9% increase in revenue growth.

Andrew also says the market is misunderstanding Apple's situation. Other companies in the sector are trading on values based on their growth opportunities, but Apple itself has a lot of future growth prospects, including a possible smart watch and a lower-cost iPhone. Investors are also likely to get an increased dividend payout soon.

Check out the video for further details.

There's no doubt that Apple is at the center of technology's largest revolution ever and that longtime shareholders have been handsomely rewarded, with more than 1,000% gains. However, there is a debate raging as to whether Apple remains a buy. The Motley Fool's senior technology analyst and managing bureau chief, Eric Bleeker, is prepared to fill you in on both reasons to buy and reasons to sell Apple and what opportunities are left for the company (and your portfolio) going forward. To get instant access to his latest thinking on Apple, simply click here now.


Read/Post Comments (4) | Recommend This Article (6)

Comments from our Foolish Readers

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  • Report this Comment On April 21, 2013, at 12:07 AM, kevins71 wrote:

    Why some many articles about Apple's stock? Why not focus so much attention on one company? can we focus more on other companies perhaps, for once?

    So sick and tired of these speculation articles. What has happened to journalism today? Seriously, it's all become reality show, over the top, over dramatic, speculation, TMZ style reporting. It just plan sucks.

    And I work at a newspaper, thank God we don't print garbage like this.

  • Report this Comment On April 21, 2013, at 1:31 AM, DanManners wrote:

    Andrew,

    You know i am very fond of you . You could be the son i never wanted. But you have it all wrong. There is no doubt Apple will go to 300 and way below. You have to assume that Tim Cook will bring this company to its knees. I see below $ 100 by next year. This stock will not stop dropping. As Melissa Lee argued the other day, all this "the stock is cheap is true" but it won't stop dropping. This is more than capitulation.

    No dividend increase that matters, no iTV, no iWatch. just a mild upgrade to the i5 and ipads line. Now the reason this is bad is

    1. Mild upgrades don't stop the advancement of Samsung and seem lame

    2. Problems with the new ios7 and iphone5 as we find out similar problems like maps and scuffing. Apple is insane to have created these problems. I think the next product will scuff when you just look at it.

    3. Lost margins and ASP leading to much lower EPS. With EPS at 30 for next year (or lower) and a 7 multiple (compression we are now at 8+) then you have just over $ 200 per share. You can't add the cash back as that cash will be needed to survive. Look at the cash = share price in Nokia. Not helping it go up. Maybe helping it from going down as much.

    In closing, I would like to say, Tim Cook will do just about everything wrong. We will have supply constraints again. He will make the phones too difficult to make and he won't check anything before he releases it.

    The best way to make the stock go up is to can Cook. Say that ten times.

  • Report this Comment On April 21, 2013, at 2:10 AM, thecrazykevy wrote:

    Apple is finished as a company, over, done for. They will be bleeding run ink like tomorrow within 5 years and fighting to avoid bankruptcy before 2020. It like the Titanic, you know it is on course to crash into an iceberg but it is too big to move out of the way.

    The smartphone and tablet market is becoming more and more of a commodity market. Like other hot consumer electronics of the past such as DVD players or LCD TVs, prices will keep coming down and down and down. There’s no way for Apple to be able to sustain their current prices and margins.

    Gross margins have dropped from 40% to 30% already. It will continue dropping to 20% and then 10%. Within a year or two there will be tons of cheap Chinese branded smartphones who are willing to sell at 5% gross margins flooding the market.

    Just take a look at Sony, Sharp, and Panasonic currently for Apple’s future. A decade or so ago they dominated the consumer electronics industry. Now they are facing massive loses and are now just a few bad quarters away from bankruptcy. This will be Apple soon enough and the stock will be under $50.

  • Report this Comment On April 21, 2013, at 4:45 AM, TheOriginalPrez wrote:

    I don't know what is worst, the article or the comments.

    I've seen someone mention $100 share price, and another mentioning $50. You do realize that the cash holdings are worth $130 a share? And before you say they are going to need the cash because they are going to be bleeding red ink keep the following in mind

    - They don't own the production line, so they only pay per unit made.

    - Margins are so high that they could sell iphones in the budget market and still reap a nice constant income stream from itunes.

    But i don't see apple cutting the cost of the phone much, its a premium product and image is everything. I'm surprised no one here has picked up on the Steve Jobs business model. All he did was replicate the sneaker model. Once, sneakers were poor peoples footwear but put a high price on them and everyone wants them. Steve Jobs tried this before with apple more than once and failed. It failed with the personal computer, but he eventually hit success with the ipod and then the iphone. Apple has a almost cult following, you only have to see that when people line up all day to buy a phone........a friggin phone. If i'm standing in line that long, it better be a heavily discounted product.

    But apple has a lot of directions it can go in, it has the possibility of different models instead of just the 1 basic type. It can continue to expand in markets line China and India. It can tap into new product lines like tvs.

    I see lots of upside in this stock, and little downside. But while the people talk that Apple is going down, their cash pile keeps going up.

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