There will likely be few stories today that draw more opinion and violent disagreement than Apple's (NASDAQ:AAPL) dip below $500 per share. Some are blaming a Wall Street Journal story, which reported that Apple, based on weak iPhone 5 demand, had cut its orders to several component makers. Shares opened sharply lower on the news, leading some to see value while others see the latest in a long series of disappointments that favor selling the consumer electronics king.

Cirrus Logic, which counts Apple as nearly its exclusive client, and Qualcomm both opened lower on the news. The story seems to have sprouted legs, accelerating the levels of the reported cuts to 50% and driving shares lower. While there are several very real threats on the horizon for Apple, at current levels, I believe the shares remain a bargain (but today's close will be important).

So what's going on?
In response the slide, Bloomberg attempted to clarify the matter by pointing out that in the realm of supply-chain math, the numbers do not always add up. Reduced orders may signal that Apple expected to sell fewer iPhones than originally expected, but quantifying these numbers based on the whispers is definitely risky. The story additionally points out a report from UBS that highlighted the reality that the reduced component order was disclosed over a month ago, relates only to the first quarter, and is not dispositive.

Reports from the mainstream media and the blogosphere are squarely in two camps: Apple's in trouble, says one group, while the other screams that Apple is firing on all cylinders. My take is that the truth lies somewhere in between the extremes, and that the goal is to distill the information into actionable investment news. While I certainly have concerns over Apple's slowing innovation, the stock is very solid and has more upside at this point than downside.

The biggest threats
My single biggest concern for Apple is that the company has lost a bit of its focus and, as a result, is becoming more reactionary than it should. Apple once blatantly ignored the trends in the market, preferring instead to lead by telling consumers what they should want. While that attitude still exists to an extent -- witness the decision to leave the iPhone 5's screen smaller than many top-level competitors' phones -- the release of the iPad Mini felt very reactionary to me. Of course, the sales figures will support the decision, but the product was what people wanted, not what Apple told us was worth wanting. Times do change, but this is an area of concern.

Another worrisome spot for Apple is its product life cycle. In the early days, when Google's (NASDAQ:GOOGL) Android was just gathering steam, the once-a-year product upgrade system served Apple well. As much as the Apple faithful will disagree, however, the launch of the iPhone 5 felt very anticlimactic. There were some upgrades and improvements, but the new device felt more like Apple was catching up than leading the way. Perhaps the most significant upgrade was the inclusion of the Qualcomm chip that finally brought Apple to the 4G LTE platform.

At this year's Consumer Electronics Show, Samsung unveiled Youm, the OLED display that is both bendable and capable of being wrapped around a device to create an assortment of new applications. While the advance itself is impressive, the point for Apple is that with Samsung controlling roughly 90% of the OLED market, this innovation may not soon be available on an iPhone. In this case, even Google may have to wait, as the presentation featured a Windows-based smartphone, not an Android one.

Again, it is not just the technology that is at issue -- even if Apple had access to OLEDs in sufficient supply, based on its usual product cycle, other options would spent considerable amounts of time on the market before Apple's product could arrive. Android, and likely Windows, are not limited to a single set of devices, so they are always in a state of flux and upgrade. Not so with Apple. The company may need to address this issue, particularly as rumors suggest that Google may soon release an "X Phone" specifically designed to have the sleek simplicity that has kept the iPhone humming.

Still a buy
With the explosive growth taking place in the smartphone market, there is more than enough room for Apple to face serious competition and still flourish. The stock is down nearly 30% from its all-time high and has plenty of upside. I do believe that for the short term, today's close is important, because a close below $500 will have a psychological impact and perhaps favor waiting a bit to buy. Either way, a small stumble has not rendered Apple out of the game, and at current levels the stock belongs in your portfolio.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.