But given the absence of any catastrophic bad news, why is AAPL stock tumbling? And where will it stop?
It's important to note off the bat that Apple's fundamentals are just as strong as they were last fall when the stock began its huge run-up from just under $400 to $636.23 on April 9 (it hit an intraday high of $644 on April 10).
In short: Apple still expects to make a mountain of profit this year. Apple still has over $100 billion in cash with no debt. The company's price/earnings ratio is about 13.50 for the trailing 12 months and its forward P/E just 10.
So something else must be driving down Apple stock. Some of it is logical, some of it emotional - but none of it permanent.
Let's take a closer look:
- A Parabolic Rise: First and foremost, AAPL simply rose too far too quickly. Rapid gains beg profit-taking.