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Apple's stock market effect

Posted Jun 09 2008, 04:02 PM by Kim Peterson
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Why were Apple shares down Monday, with all the big iPhone news? Chalk it up to the typical storm of hype that surrounds Apple announcement. Expectations ratchet up so high that CEO Steve Jobs would have to juggle 10 iPhones on one foot to impress investors.

Apple stock was weak all day, but recovered in the final hour of trading. It closed down 2.2% on heavy volume to $181.61. Here's how Apple's news affected other stocks:

AT&T: AT&T is the exclusive U.S. carrier for the iPhone, and its generous subsidy caused the iPhone's new price to drop to $200 and $300. The company said today the subsidy will hurt short-term earnings and margins, and that the iPhone deal won't turn accretive until 2010. Potential EPS dilution this year and next will be in the range of 10-12 cents, the company said. Shares of the telecom giant plunged after the price cut was announced, and closed today down 1.7% to $37.56.

Garmin: Apple's built GPS capability into its iPhones. Will the casual GPS user have any need for Garmin when other phone makers follow suit?  Garmin shares fell as much as 5% today before recovering, and closed down 3.4% to $49.58.

EBay: EBay had a role in Apple's announcement today. The new iPhone will have an application that lets people check their auctions and watch items. Didn't seem to faze investors, though. EBay shares dipped today but closed down less than 1% to $29.07.

Research in Motion: Is the iPhone a BlackBerry killer? Cue the Nelson Muntz laugh. RIMM investors saw no threat today, pushing shares up 2% to $134.12.

Google: Google and Apple are buds and all, but the two still compete on the smartphone front. Google is developing the Android platform for smartphones, and consumers could see Android phones from third-party manufacturers later this year. Google shares fell 1.6% to close at $557.87.

Related reading:

New BlackBerry coming. iPhone who? 

Preposterous but true: Apple's worth more than Citigroup 

Reining in hype for the new iPhone 

Solar-powered iPhone? 

iPhone a huge boost for Broadcom

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Comments

 

its called investors (wall st idiots) not being happy with the price cut thus not realizing that by making the price cut will only increase the amount of units sold worldwide thereby making up the difference in volume.

APPLE WILL HIT $230 by February 2009 not bad all in all

bg (Posted 06.09.08 9:17 PM) Report Abuse

This is definitely a DEFINING MOMENT in mobile history.  I'm not an apple fanboy but I'm been using fan of mobile phones for sometime and if people realize much Apple cares about innovation, you will see their stock rise.  They released their 1st generation iPhone in one country....now 70.  If you're not a believer, pick one up and just give it a try.....trust me...you'll be astonished.

iPhone 3g will change the Mobile World (Posted 06.10.08 4:23 AM) Report Abuse

Rember that Steve Jobs marking plan bankruped apple the first time, and people will get tired of his marketing plan again sooner or later. closed systems allways lose.  

JBean (Posted 06.10.08 4:34 AM) Report Abuse

I find it funny that you make it seem that only AT&T was effected by the price cut. It's pretty obvious that the price cut was the main issue here.

Do you have any trading experience Ms. Peterson?

Will (Posted 06.10.08 5:35 AM) Report Abuse

The new iPhone was not impressive at all, as per an Apple genius friend.  At the demo, the new iPhone doesn't compare against the new Blackberry.  

Overrated (Posted 06.10.08 5:45 AM) Report Abuse

What is the big deal about iPhone?

It's just a weaker repackaged rip-off version of European phones that use WM6.

IveBeenRobbed (Posted 06.10.08 6:21 AM) Report Abuse

The only thing I'm astonished about is that the second-gen iPhone still does not have multimedia messaging or video recording.

Andy (Posted 06.10.08 8:32 AM) Report Abuse

MSN is always trying SO hard to bash Apple.... Could it have to do the MicroSoft in MSN?

iJim (Posted 06.10.08 8:36 AM) Report Abuse

the stock will rise again, it the brand name you idiot, ever heard of coke, dairy queen, fruit of the loom, all doing well know!

warren

Warren Buffet (Posted 06.10.08 8:39 AM) Report Abuse

The 3G iphone will be a significant improvement over the current iphone (which I have) and the biggest benefit is that it will promote other Mac products. See more here : www.savingtoinvest.com/.../my-shiny-new-iphone-and-why-i-bought.html

So the cross selling opportunities are huge. While the technology is nothing new, Apple's marketing and brand will make it more succesful. Just think of the incremental revenue from international sales. Even if Apple gets 15 - 25% of the gloabl smarthphone market - it will double the stock price in 3-5 years.

AndyS (Posted 06.10.08 9:09 AM) Report Abuse

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