Shares of Apple Inc. bounced back from a week of losses on Friday to close at US$547.06, a gain of $9.31 per share (+1.73%), on heavy volume of 33.2 million shares trading hands. The bounce might have been a correction to the correction, and it was most likely helped by positive comments coming from UBS after three of its analysts visited Apple's headquarters.
It was a rough week for $AAPL, which started with a close of $584.62 on Monday and ended Thursday at $537.75, a loss of $46.87, or 8 percent. That's on top of the steeper losses since September 19th, when AAPL hit an all-time closing high of $702.10.
Helping to push Apple's stock down this week were comments from Hon Hai Precision Chairman Terry Gou, who said his company's Foxconn operations were having trouble meeting demand for Apple's iPhone 5. As we reported on Wednesday, concerns about Europe and worries over the U.S. "fiscal cliff" dragged down the entire market, including AAPL.
On Friday, however, got a little relief when UBS released a research report on Apple after analysts visited the company's headquarters. That note basically told the firm's client that it turns out things are still pretty good in Cupertino.
"With earnings momentum bottoming and near-term upside EPS surprises more likely, we continue to like the stock here," the authors of the report wrote. Those authors were regular AAPL analyst Steven Milunovich, as well as Peter Christiansen and John Roy.
They added, "Apple is selective about what it does in providing platforms and services to consumers. The company does see new categories to create and appears interested in services. Apple expressed less interest in owning content or its own network. Surprisingly, it played down the mobile wallet opportunity."
The analysts also said that Apple remains a product-focused company, rather than finance-focused. This is extremely important in that Apple built its amazing success by focusing on making great products and letting the profits flow from that.
This was a message hammered home by cofounder Steve Jobs before his passing, and it was echoed by then COO and acting CEO Tim Cook. That Mr. Cook is repeating it now is likely in response to recent cries that Apple has lost its innovative edge from various bears and critics.
"Some Apple naysayers argue that the passing of Steve Jobs will represent the peak of Apple in retrospect," the report said. "Given that Jobs likely left a multi-year product plan, it is too soon to know. Apple argues that management has been together for some time and that the decision process has changed little. The operating committee meets every Monday from 9-12 and decides which product areas are promising."
Other fuel for AAPL's fire on Friday included Seabreeze Partners president Doug Kass cashing in on negative comments he made in October. As noted by Philip Elmer-Dewitt, Mr. Kass reversed his stance on the company, now that it has been heavily discounted, and is now a buyer.
*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.