Please ensure Javascript is enabled for purposes of website accessibility

Why Apple Stock Plunged Today

By Joe Tenebruso – Updated Sep 4, 2020 at 10:28AM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The tech giant has now lost $350 billion in market value in a matter of days.

What happened

Shares of Apple (AAPL -1.51%) fell on Friday, furthering the technology titan's recent swoon. As of 10:35 a.m. EDT today, Apple's stock was down more than 6%.

So what 

After seeing its market cap soar to a staggering $2.3 trillion following its blockbuster third-quarter results and subsequent stock split, Apple has now shed roughly $350 billion in total market value. That's a stunning figure -- one that's larger than the market caps of approximately 98% of the other companies in the S&P 500. 

A downwardly sloping stock chart.

Apple's stock has plummeted in recent days. Image source: Getty Images.

What's even more startling for investors is that there hasn't been a clear reason for the decline. Yet Apple, like many other stocks, has fallen sharply over the past few days as the market has pulled back violently from its recent highs.

Now what

Volatility is the price investors must pay if they wish to build long-term wealth in the stock market. In the short term, stocks can rise and fall for reasons that are difficult to decipher. But over the long term -- a period that should be measured in years rather than weeks or months -- a stock's worth is ultimately determined by the fundamental value of its underlying business.

In this regard, Apple's future remains bright. A 5G-fueled iPhone upgrade appears set to drive the company's device and services sales (and, by extension, its earnings and cash flow) sharply higher in the coming years. So as its price falls along with much of the rest of the stock market, long-term investors may wish to use this opportunity to buy Apple's stock at a discount.

Joe Tenebruso has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Apple. The Motley Fool has a disclosure policy.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Apple Inc. Stock Quote
Apple Inc.
AAPL
$150.43 (-1.51%) $-2.31

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
329%
 
S&P 500 Returns
106%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 09/24/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.