Wednesday's Apple stock story is a tale of two analysts occupying different ends of the spectrum, with a variety of other analysts staking out ground in the middle. Brian White of Topeka Capital named $AAPL his top pick for 2013, while Pacific Crest analysts Andy Hargreaves downgraded the stock predicting iPhone doom and gloom.
In the meanwhile, $AAPL itself bounced off of Tuesday's losses to cross back above the $500 mark. As of this writing, shares of Apple were trading at US$508.20, a gain of $22.28 (+4.59%) on strong volume.
$AAPL Chart for January 16th
Source: Yahoo! Finance
Brian White told his clients that, "The negative sentiment around the stock has reached epic levels that we haven't seen in recent memory and yet we believe the product portfolio has never been stronger."
He reminded them that Steve Jobs had insisted that Apple's brightest days were still to come, a message he still believes despite that negative sentiment. He believes that Apple will finally sign a deal with China Mobile in 2013, and that the company will reinvent the television experience during the next year or two.
He advised his clients not to make much ado out of reports of order cuts, a message that reinforces Sterne Agee analyst Shaw Wu's comments on the matter.
Mr. White is at the highest of the nose-bleed seats with a US$1,111 price target on $AAPL, more than twice what the stock is currently trading for.
Not so, said Andy Hargreaves of Pacific Crest. He told his clients that Apple's iPhone business is pretty much maxed out with little room for growth for the company. iPad? iPad mini is cheap and will hurt Apple's revenues. Apple TV? Pshaw. Ain't gonna go nowhere nohow. Cheaper iPhones to provide growth? Whatever. Incremental improvements to the iPhone itself? Yawn.
No, Mr. Hargreaves said that Apple's fair value is in the $440-$550 range, and he downgraded the stock to "Sector Perform," the equivalent of a "Hold."
Investors either didn't get the memo or were unconcerned, as the stock traded in positive territory throughout the day.
*In the interest of full disclosure, the author holds a tiny, almost insignificant share in AAPL stock that was not an influence in the creation of this article.