It looks like the iPhone 5 is a fail than a triumph for “Fruity” company. Apple shares reached $700 for the first time ever a few days after the iPhone 5 was announced. Since then, “the company’s stock has declined on fears about iPhone 5 supply constraints — most recently from reports of a strike at Foxconn, Apple’s Chinese manufacturing partner”. As of November 18th, the company’s market capital fell down to $497 billion. As a result, Apple lost about $162 billion in market capital from the peak reached on the day the iPhone 5 was launched. As a comparison, that’s more than the current market capital of these companies altogether:
- EBay – 60 billions.
- LinkedIn – 10 billions.
- Sony – 10 billions.
- Nokia – 10 billions.
- TD – 70 billion (YES IT IS TORONTO DOMINION BANK).
As of November 18, Apple’s stock was trading at around $527 a share, valuing the company at $497 billion.
So, why the company loses its share price? Here are two assumptions of mine:
- Left hook – Kindle Fire HD which is cheaper than Ipad mini, has a better resolution and a faster processor.
- Right uppercut – Google’s new product line. The most dangerous are new Google Nexus smartphone and IPads’ 10 inch analog. Google’s products’ specs are better than Apple’s; moreover Google’s products are cheaper. Just look at the upper chart.