A few hours into trading yesterday, shares of Apple (NASDAQ:AAPL) fell below $400. They're doing the same today.
Apple stock has been here before. The shares traded as low as $385.10 when it bottomed out two months ago. However, seeing the world's largest consumer tech company weave over and under $400 has to be difficult to watch.
For starters, outside of that April dip, investors have to go all the way back to late 2011 to find the last time that Apple stock broke below $400. Apple is selling far more iPhones and iPads than it was back then. Does that make this the mother of all buying opportunities?
Not so fast.
From a valuation perspective, Apple is historically cheap at 10 times this year's projected profitability. The fundamentals aren't as kind. Apple's margins continue to contract, and Wall Street's bracing for declining net income on modest top-line growth during the latter half of fiscal 2013.
Apple isn't as fresh as it used to be, and that's turning off investors and early adopters. Apple is no longer a can't-miss tech darling after seeing its stock plunge 43% since peaking the morning that the iPhone 5 hit the market. Consumers are also turning away, and we see that in wireless carriers pointing out that half of their iPhone sales earlier this year were for the cheaper iPhone 4 and iPhone 4S models. Apple's shrinking average selling price on iPhones bears that out.
Apple's losing its cool, and Apple stock is no longer hot.
How bad are things? Well, BlackBerry (NYSE:BB) reports quarterly results on Friday. Analysts see revenue soaring 23%. Apple is now a couple of quarters removed from its last quarter of double-digit top-line growth, and analysts don't see that resuming for another year.
Apple's posting year-over-year declines in profitability. BlackBerry is just returning to profitability, reversing a year-ago loss.
Apple may not be alone here. The world's leading smartphone seller -- Samsung -- has been weak on reports that its Galaxy S4 handset isn't meeting the company's initial targets. On Friday we'll hear form BlackBerry, and it wouldn't exactly be a shock if guidance isn't up to snuff.
The industry's tiring, at the worst possible moment. It's not just Cupertino.
However, given Apple's history as an innovator, this may also be the time for the forgotten tech giant to break out its next bar-raising move. It's why it's hard to sell Apple here, even as it has earned every downtick on the way down.
When Apple's back is against the wall -- and that's exactly where it is these days -- history has shown that's the best time to be a buyer.
Dump Apple at your own risk.
Longtime Fool contributor Rick Munarriz has no position in any stocks mentioned. The Motley Fool recommends Apple. The Motley Fool owns shares of Apple. Try any of our Foolish newsletter services free for 30 days. We Fools may not 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.