Hello dear readers! Investing in securities largest companies is often cited as the best investment, but how does that compare with the fact that Apple's stock fell?

I propose to find out the factors influencing the price of shares of the IT giant, find out the prospects of the corporation and get acquainted with the forecasts of experts - in which direction the price of Yabloko shares will change in the near future. Let's also find out whose paper is worth buying as an alternative to investing in Apple.

• iPhone XS starting at $ 999;
• XS Max with 6.5-inch screen starting at $ 1,099;
• XSMax with increased memory capacity up to 512 gigabytes - from $ 1449.

Smartphone buyers greeted the new gadgets relatively indifferently, experts ruled out the rush demand in advance, which was the reason for the falling share price.

The second reason is the fact that a week earlier Apple shares already set a record of $ 229.67, bringing the corporation to the first place in the ranking of the most expensive on the planet with a capitalization of $ 1 trillion.If the trend reaches its peak, then further downward movement occurs ...

On Friday, November 2, shares fell immediately before trading by 5% to the end of the previous day, to $ 211.2: this is how the market took the sincere recognition of the corporation's representatives that it stops publishing information on the number of iPhones, iPads and Macs sold.

Although the company proceeded from the interests of investors, for whom it is more important to know how much money the issuer earned, and not how many units of goods he sold.

But the shares fell most of all after the New Year - on January 3, 2019, securities fell during trading by 9.43%, or to $ 143.03 by the close of the day. Again, the corporation "let down" honesty - its head Tim Cook warned investors that Apple expects a decrease in revenue in the first quarter due to unpredictable problems with sales in China and other countries with growing markets.

Mr. Cook attributed the fallen sales in the Middle Kingdom to the trade wars between Washington and Beijing. As a result, shares of the American giant's Asian suppliers fell after Apple's shares, and Yabloko itself slipped from first place in the world in terms of capitalization to fourth, losing the pedestal to Microsoft, Amazon and Google.

What's happening with Apple stock now

Stock price on the stock exchange: online chart

In early June, Apple fell again after media reports of an upcoming review of the corporation for compliance with US antitrust laws.

Even the presentation of iOS 13, which took place on June 3, was overshadowed by the news of a possible visit to Apple by inspectors from the US Department of Justice. According to Reuters, such plans of the department are connected with repeated accusations of the giants of Silicon Valley of discriminatory actions against the Republicans in favor of the Democrats, sounded from the lips of Donald Trump himself.

It is expected that for the same reason, the Ministry of Justice will also "shake" Facebook and Google, whose securities fell simultaneously with Apple's.

However, after the aforementioned fall in early January, Apple shares went up again and until June were steadily increasing in price, and on June 5 they returned to the "green zone".

Course dynamics for all time

Apple shares, traded on the NASDAQ stock exchange under the AAPL designation, are characterized by stable growth and a significant decline, alternating with long-term trends. At the same time, the volatility of the shares of the giant, which changed the world with iPhones and iPads, does not exceed the indicators of other issuers on the US stock market.

Decreases in AAPL tend to be short-term. Quotations fell seriously only in 2008, but this is explained by the world financial crisis... The dynamics of Apple itself has consistently remained positive.

From 2006 to 2017, the shares increased in value 15 times. A 15-fold increase in the price of this asset plus dividends - this is how much private investors earned during this period, who bought the company's securities and did not dump them later.

What affects the share price

The value of the IT market giant's securities is determined by:

1. The demand for gadgets, computers and other Apple products.
2. A behavioral factor - above I described how painfully Apple investors react to negative news about the corporation.
3. Indicators financial statements: revenue, gross profit, p / e, p / b ratio.

It is noteworthy that on November 2, 2018, dissatisfaction with the concealment of the number of gadgets sold for some reason prevailed over the report published the day before, according to which the corporation increased both income and net profit.

Company Perspectives

Analysts are inclined to believe that the development of the new iPadOS operating system, presented simultaneously with iOS 13, will become a serious growth driver for Apple, allowing it to significantly increase the power of new iPads, and with it, sales of tablets.

But even with the most disappointing state of affairs with the sale of gadgets, Apple is not threatened with bankruptcy, since the company's activities are not limited to them. She actively develops:

1. Own online TV service, providing access to the most in-demand content exclusively through a paid subscription.
2. Service mobile banking Apple Card with the issue of payment and credit cards.
3. Apple Arcade is a new catalog of games, including exclusive ones.
4. Apple News + is a subscription service for the world's most popular magazines for online reading.
5. A number of innovative areas (artificial intelligence, ANN, augmented reality technologies and autopilot).

In addition, the company has a colossal margin of safety, allowing it to overcome any difficulties and continue to grow in the future.

Analytics and forecast for paper

Experts predict that Apple will retain its leading position in the IT-device market, which guarantees its unrelenting popularity among investors. The positive dynamics in the next few years will remain the same. Investors are being asked to put aside worries about whether Apple shares will fall again.

In favor of AAPL is the report on the income of the corporation for the last 12 months (growth in percentage):

• gross profit - 38.5;
• operating margin - 25.34;
• profitability ratio - 21.69;
• return on investment - 21.3.

The volume of finance received from operating activities for the half-year from October 1, 2018 to March 30, 2019 amounted to $ 37 billion 845 million, net change Money- plus 13 billion 904 million dollars.

Apple's main competitors in the market for physical IT products are Samsung, Sony Mobile, manufacturer of wrist gadgets Fitbit, laptops - Dell, headphones - Bose, developers software products Microsoft, Facebook and Google.

Their shares should be bought either instead of AAPL, or at the same time with them, diversifying the portfolio and saving yourself from losses due to falling quotes.

Conclusion

The company's earnings provide compelling evidence that Apple is doing well. Misunderstandings with Trump and lower-ranking politicians are solvable, the falling stock prices due to behavioral factors is a short-term phenomenon.

It follows that the purchase of AAPL - good investment money, even if stocks have dropped repeatedly throughout the year. Sly investors surely managed to earn decent money on this rally.

At the close of trading, Apple shares were worth $ 216.7, the highest since early November last year, Bloomberg.

The main news of the presentation for many was the cost of a subscription to the Apple TV + streaming service, which the company promised to launch on November 1. The subscription will cost $ 4.99 per month. By comparison, the most popular Netflix subscription plan costs $ 12.99, while the upcoming Disney + service costs $ 6.99. In addition, Apple has promised to provide a year of free subscription to those who buy the company's new device.

Following this announcement, shares in other streaming companies fell. Price valuable papers Netflix sank more than 3% after Apple's announcement, but then the paper regained some of its losses and declined 2.16% at the close. Disney shares were down 3.04% by the end of the day. TV set-top box maker Roku, which competes with Apple TVs in this space, fell 12% and dropped 10.49% by the close.

“We did not expect that price policy[game service] Arcade and especially Apple TV will be so aggressive. The company understands that when consumers join the ecosystem, they don't leave, ”Ben Bajarin, an analyst at Creative Solutions, told Reuters. Managing Director at financial company Wedbush Securities Michael James called the price of Apple TV + "a pleasant surprise" and emphasized that this announcement is why shares of other streaming companies are getting cheaper. “This is definitely good news that people were happy to hear,” he told the agency.

Investment bank Piper Jaffray notes that services "for several more years" will not bring income to Apple, writes The Wall Street Journal. But their launch shows that Apple is striving to become less dependent on iPhone sales, the bank said.

At the same time, a limited amount of content may hit consumers' interest in Apple TV +, emphasizes Piper Jaffray. CNET journalist Joan Solsman writes about this. She points out that Apple TV + will launch a total of nine original shows or series, and will release five more in the coming months. Disney + will launch with a library of 300 films and 7,500 episodes of various TV series and shows. Netflix will have 32 original shows by the time Apple TV + launches, Solsman said.

In addition to services, at the presentation on September 10, Apple, in a tradition that has continued since 2017, introduced three new smartphones - iPhone 11, iPhone 11 Pro and iPhone 11 Pro Max. Smartphones with the Pro prefix are the first in the Apple line with a triple camera: smartphones are equipped with three 12-megapixel lenses at once, which improves the quality of images taken in low light. In addition, the iPhone 11 Pro lasts four hours longer than last year's XS, and the Max five hours longer. Also, for the first time, fast charging will appear in the kit.

Prices for the iPhone 11 will start at $ 699, for the iPhone 11 Pro - from $ 999, iPhone 11 Pro Max - $ 1099.

“Apple this year has made it much clearer for whom this or that smartphone is designed. The Apple 11 will suit the average user looking for a longer battery. iPhone Pro is made for those who are willing to pay for more power, camera and video tools, ”writes The Wall Street Journal journalist Joanna Stern.

The stake on the mass iPhone 11 is very strong in communication with Forbes and the head of Hi-Tech Mail.ru Dmitry Ryabinin. He noted that the model is at risk of becoming the best-selling smartphone of the pre-holiday quarter, despite the fact that the technical characteristics are rather commonplace for the market as a whole.

While the Russians celebrated with might and main New Year, Apple shareholders read an alarming letter from the head of the company, in which he admitted that the already not very optimistic forecast for the end of 2018 would have to be slightly worsened. The originally expected $ 89-93 billion for the first fiscal quarter of 2019 (in the US it lasts from October almost to the end of December and is considered the most profitable time thanks to the Christmas holidays) turned into 84 billion by January 2 - minus 4.9 percent compared to 2017 -m. It's all about the timing of the release of the new iPhone, Cook justified himself: the previous model X was presented in the first quarter of 2018, and its slightly more improved versions of the Xs and Xr - in the fourth quarter (from July to September), which means by the last three months of the year the calendar rush has already cooled down.

There were other reasons as well: a too strong dollar, which ate two percent of turnover when converting foreign earnings, trade restrictions, problems with demand in emerging markets, and even an unprecedented number of new products presented that consumers simply did not have time to digest. And thanks to the battery replacement discount program, they began to extend the life of their old gadgets and ignore the new ones.

The main losses fell on the Chinese market - in other regions, Apple earned, albeit not much, but still more than a year earlier, and in the USA, Canada, Germany, Italy and some other countries - it even set its own record. Moreover, even including China, global global income in the first quarter of 2019 will be positive (plus 19 percent) if we exclude smartphone sales. Separately, the company is proud of the success of its paid services: Apple Music, Apple TV, iTunes, iCloud - their total quarterly revenue was $ 10.8 billion. Another positive point is the increase in the total number of active devices by more than one hundred million units per year.

“As we conclude a challenging quarter, we are more confident than ever in the fundamental strength of our business. Apple has always used times of adversity to redefine its approach to business, to apply its flexibility, creativity and, as a result, become better, ”- Cooke tried to reassure investors. But they did not believe him and continued to sell shares: after the letter was published on the Apple website, quotes fell by almost ten percent. Most of this decline was recouped in the following days, but the company is still going through hard times.

Remnants of a former luxury

But until recently Apple boasted of records - in July its total capitalization (total market price of all issued shares) the mark of a trillion dollars (the second time in history and an unprecedented result for American companies), but did not stop there and after three months reached the figure of 1.2 trillion. The cost of one share then reached $ 233, after Cook's announcement in January it fell to $ 142, and the total capitalization - to 671.6 billion, that is, almost twice as compared to October.

The summer's sharp growth was driven by the same thing that has now turned out sideways for the company - the data of the latest quarterly report. Only, unlike the current situation, then they turned out to be positive. Revenue exceeded analysts' expectations and grew immediately by 17 percent - to $ 53.3 billion (significant variation between quarters is a common occurrence, which is explained by the peculiarities of Apple's business and seasonal factors).

Even the reduction in the total number of devices sold did not stop - it was compensated high demand on more expensive models costing from a thousand dollars. The figures from the report confirmed the main thing: contrary to the forecasts of skeptics, the most expensive iPhone X in the lineup became the best-selling model and sold 41.3 million units worldwide in one quarter. And this made it possible to bypass the main competitors in terms of revenue - South Korean Samsung and Chinese Huawei, leading in terms of the number of gadgets sold.

Soared too high

Apple's success is a logical reflection of the state in which last years stayed all American stock market... After the global crisis of 2008-2009, the (FRS) held base rate(on which the level of rates in the debt market depends) at an extremely low level, thereby giving businesses the opportunity to borrow money cheaply and encouraging the population to spend them - at the expense of unattractiveness bank deposits and bonds.

As a result, companies invested a lot in their development, citizens ensured the demand for their products, profits grew, and with them the quotations of shares on stock exchanges. For example, the S&P 500, which includes Apple and other major US high-tech companies such as Facebook, has skyrocketed 325 percent since 2009. According to the laws of economics, which provide for the cyclical nature of all processes, such growth could not continue forever. And the longer it lasted, the more inevitable the decline was.

Photo: Julien Mattia / Globallookpress.com

Facebook was the first to experience it: for one trading session July 25 promotions social network lost 23 percent of the value. This was led by weak (according to investors spoiled by the growing market) reporting, and the scandal around the data leak that allegedly influenced the outcome of the US presidential election. The company tried to reassure shareholders by assuring them that it would modernize its personal data protection system. But the effect turned out to be exactly the opposite: investors were afraid that this would greatly increase costs and the company's shares went down again. The example of Facebook is very important, because the social network is part of a group of companies known as FAANG (Facebook, Amazon, Apple, etc.). In recent years, they have been the leaders of growth, and the problems of one company could spread to others.

Old not forgotten yet

In the end, this is what happened, albeit with some delay. First, the success of Apple Amazon - its capitalization briefly reached a trillion dollars in early September. However, then Tim Cook at the traditional presentation showed the public two new products: iPhone Xs and iPhone Xs Max. Everyone is already accustomed to the slight differences between the models with the S prefix from their "original", but this time there were even fewer changes, not counting the giant size of the iPhone Xs Max. A month and a half later, the iPhone Xr went on sale - a budget version of the X and Xs models, almost in no way inferior to them.

Apple hoped that the average price is 23 thousand rubles lower than that of the iPhone Xs (depending on the amount of built-in memory), will attract buyers from the middle class, and called it the best-selling iPhone of all time, but in fact, already in November (less, than a month after it went on sale) was forced to produce it.

The official wording sounded dry: "The main customer has notified that he does not need so many goods." Experts named several reasons for the unpopularity of Xr, the main of which is the too weak screen, whose brightness and contrast indicators are inferior to the same Xs. Because of it, the smartphone, which is quite powerful in other parameters, is no longer so attractive in the eyes of buyers (although some are sure that the display is actually not inferior to more expensive counterparts). Apple even had to sell the "original" version of the iPhone X, which became the best-selling smartphone of 2018.

It is impossible to check how things are actually going with sales: since 2011, Apple has published unified statistics on sales of flagship numbered models and models with the letter S coming out a year later. In addition, in the fall, the company announced that it would not report at all from the new year. about sales, and this applies not only to smartphones, but also to all products. After this warning, stocks slid from $ 222 in November to $ 156 by the end of December. At the same time, the entire market was falling, and there were several reasons at once: the increase in the FRS rate (the regulator is pleased with the recovery of the US economy after the last crisis and is afraid of its overheating), the work of the government for an indefinite period due to disagreements over the federal budget.

The trade war with China, which Tim Cook spoke about so actively, also influenced - it increased the costs of companies for duties and hit demand. It also affected Apple's business: many components and gadgets are manufactured in China and when imported into the United States are subject to increased duties as foreign goods. At the end of December, several stock exchanges collapsed so rapidly that Finance Minister Stephen Mnuchin had to call the heads of the country's largest banks to make sure they were able to issue loans. At the same time, there were comparisons of the situation with the Great Depression of the 1930s and talk about the possible dismissal of Mnuchin himself, with whom President Donald Trump was allegedly very unhappy.

Fog on the horizon

In early 2019, the crisis worsened: after Cook's letter to Apple in fourth place by market capitalization, behind Amazon and Alphabet (Google's parent holding), the company's shares are now worth 720 billion dollars. Analysts are not yet advising to sell off Apple shares: it has a solid margin of safety in the form of accumulated cash. For the most part, this is foreign revenue, which the company was in no hurry to return home due to too high taxes (a year ago Trump, as part of his reform, the rate from 35 to 15.5 percent).

But economists also admit that improvements should not be expected in the near future: a slowdown in Chinese growth, which is called the main threat to the world economy, will inevitably lead to a further drop in demand in this important market. The preferences of the Chinese are likely to be influenced by the policy of Washington towards their companies: in the United States, restrictions against competitors from Huawei and ZTE have already been in place for several months, and Huawei top manager Meng Wangzhou is waiting for a trial on charges of cooperation with Iran despite the sanctions.

Under these conditions, local brands are gaining popularity at home: in addition to Huawei, these are Xiaomi and Oppo, and the old iPhone models were banned due to patent disputes with the American one. She is suing Apple around the world, claiming that its technology used to make chips was stolen and leaked to, which has been installing its components on iPhones since 2011. Qualcomm has already won trials in Germany and China, and if in the first case the losses turned out to be small and affected only two iPhone models in 15 German stores, then Chinese consumers are weak, therefore there is a large impact on the overall financial performance it will not, but in our country we can expect a further drop in sales - by the way, mainly due to the high cost.

Over the past two months, prices have increased twice: in October (without explanation) and in early January - by 1.7 percent due to the increase in VAT. Due to the fall in demand, the company is again cutting its smartphone production, this time by 10 percent. And at the same time he comes up with non-standard moves in the hope of attracting buyers. The other day there was a patent for a "smart" fabric with built-in electrical components that can connect to gadgets, a smartphone with three cameras on the back is expected to be released in the fall.

And only President Trump has a simple recipe: “Apple will be fine, it's a great company, they just need to build their factories, big beautiful factories that stretch for miles in the United States. China is now the main beneficiary of their activities. " For the head of state, such a scenario would be an excellent opportunity to keep his election promise and create new jobs in the country, but this position is unlikely to be understood by Apple's top management.

Apple CEO Tim Cook reached out to investors and told them that the company was not doing as well as planned. After that, Apple shares fell in price by 7.5%, which led to a decrease in capitalization by $ 56 billion - to 750 billion.

Morning trading closed for Apple at $ 157.92 per share, but shares are expected to fall another 8% in the new session to $ 145.

The fall in Apple shares also hit other US tech companies, including Facebook (-1.6%), Amazon (-2.1%), Netflix (-2%) and Google (-2.1%).

Cook believes that the situation was influenced by the trade war between the United States and China, initiated by Donald Trump. Countries have imposed additional import duties on several categories of goods, which could increase the price of Apple smartphones, tablets and computers.

From a message from Tim Cook:

Apple Investors. Today we revise our forecast for the first quarter of FY 2019, which ended for Apple on December 29. We expect the following indicators:

Revenue approximately $ 84 billion
Gross margin approximately 38 percent
Operating expenses approximately $ 8.7 billion
Other income / expenses approximately $ 550 million
Tax rate approximately 16.5 percent

We expect the number of shares used in calculating the dividend distribution to be approximately 4.77 billion.

Based on these projections, we expect our quarterly revenues to be lower than we forecast, and the rest in line with our forecast.

Although it is still a few weeks before the report is compiled and published, we would like to provide you with preliminary information. Final results may differ from preliminary estimates.

When we discussed the forecast for the first quarter about two months ago, we knew that it would be affected macroeconomic factors as well as factors specific to Apple. Based on our optimistic estimates, we forecast a slight increase over the same period last year. As you may remember, we discussed four factors.

First, we knew that a shift in the release date of smartphones would affect revenue. Our top-of-the-line models, the iPhone XS and iPhone XS Max, went on sale in FY 2018, with the bulk of last year's iPhone X sales in FY 2018. We knew that this would make it difficult for us to compare financials.

Second, we knew that a strong dollar would make it harder to sell in other currencies and that it would reduce our revenues by almost 200 basis points from last year. It turned out approximately as we predicted.

Third, we knew that we had an unprecedented number of new products on sale in the quarter, and we predicted that due to supply restrictions, sales of certain products would be limited in the first quarter of FY 2018. Again, this matched our prediction. Sales of the Apple Watch Series 4 and iPad Pro were the most limited. There were also restrictions on the supply of AirPods and MacBook Air.

Fourth, we predicted a weakening of the economy in some emerging markets. This has had a greater impact on our revenues than expected.

These and other factors have resulted in fewer people purchasing new iPhones than we expected. This is why we had to revise our revenue forecast.

Apple's capitalization is about $ 900 billion. This is far from over $ 1 trillion, like last summer, but we still have one of the largest companies in the world.

Warren Buffett gave the Apple Giant approximately 25% stake in Berkshire Hathaway's portfolio, based on investments in public stocks. However, in February it became known that Berkshire had cut positions at Apple.

In the fall of 2018, AAPL shares lost about 40%. Since January, the securities began to actively recover. Before us is no longer a 100% "growth story", but also not a fully "value stock". Is it worth investing in Apple now, or is it better to play on the fall? This review will provide an answer to the indicated question.

Financial performance

The financial statements for the 1st financial quarter published at the end of January inspired investors to buy. Formally, the data is not strong. But market participants were relieved as they feared even more negative after the release of the company's weak forecast and negative messages from its suppliers.

Quarterly revenue decreased by 5% compared to the same period a year earlier, to $ 84.31 billion. Profit decreased from $ 20.07 billion to $ 19.97 billion. This happened for the first time in the last 10 years in the first quarter fiscal year when Christmas and new year holidays... One of the factors behind the decline in revenue was the devaluation of the currencies of many developing countries, primarily the Turkish lira. In response to the current situation, Apple management decided to reduce the prices of the IPhone in countries with weak national currency, said the head of the company Tim Cook.

Source: zerohedge.com

IPhone revenue dropped 15% year-on-year to $ 51.9 billion. According to Cook, the weak Chinese economy has hit sales in the region, which is the world's largest smartphone market. In the first financial quarter, the revenue of Apple's Chinese division fell by 26.7%. The company also said that sales in current quarter likely to be lower than Wall Street analysts expect, indicating continued weakness in iPhone demand, particularly in China.

Source: zerohedge.com

Other segments of the company have been more successful. Service revenue hit a record $ 10.9 billion, up 19% over the previous year. This segment accounted for 14% of Apple's revenue, with 63% for the iPhone. Mac and wearable, home and accessories revenues also hit record highs, rising 9% and 33%, respectively, while iPad revenues were up 17%.

Dividends and buybacks

As a result tax reform Apple got the opportunity to repatriate "foreign cache" preferential rate taxation. The funds are used to pay dividends and implement the buyback program. Previously, this was done using a bond placement scheme at ultra-low interest rates in the United States. As a result, the company has about $ 101 billion in bonds in circulation, and in the first financial quarter, it finally began to pay off its debt.

Source: Reuters

Analyst's median target for Apple is 12 months. is $ 195. Based on this criterion, the securities are already quite fairly valued by the market.

There are risks, however, the company is financially stable and rich in cash. It is quite possible to buy on Apple's drawdown. For medium-term purchases, I would have waited at least $ 180. The $ 165 level will allow you to more confidently enter long positions.

Read best materials on the American market at

Apple chart since 2017, daily timeframe