Could Apple Fall Back to $500?

Before you go, we thought you'd like these...
Before you go close icon

The following video is part of our "Motley Fool Conversations" series, in which Chief Technology Officer Jeremy Phillips and senior technology analyst Eric Bleeker discuss topics around the investing world.

Markets were on the rise today, but the overall move in the past month has been steeply to the negative. Europe is crumbling, and instability reigns. In this video, Eric looks at the downside scenario for Apple if the Europe situation continues to worsen. A move back to $500 would be about an 11% fall from Friday's close. That's not an implausible scenario if broader markets are falling. Apple is up 39% on the year, and stocks with the most momentum are often sold off the worst in steep market retrenchments. The company gets about 25% of its sales from Europe, so Apple definitely has exposure to the continent. Worse yet, any protracted instability could further push carriers to cut subsidies on phones, especially in peripheral countries. However, Eric notes what an amazing value Apple would be looking ahead to next year at $500, eclipsing the cheapness of go-to tech value plays like Cisco and Microsoft. To see Eric's full analysis, watch the following video. 

Apple has firmly established itself at the head of the pack of the greatest revolution in technology history. Yet it's not alone in its huge potential in the booming smartphone market. To better prepare investors for this new revolution, The Motley Fool has just released a free report on mobile named "The Next Trillion-Dollar Revolution" that details a hidden component play inside mobile phones that also is a leader in the exploding Chinese market. Inside the report, we not only describe why the mobile revolution will dwarf any other technology revolution seen before it, but we also name the company at the forefront of the trend. Hundreds of thousands have requested access to previous reports, and you can access this new report today by clicking here -- it's free.

At the time this article was published Eric Bleekerowns shares of Cisco Systems. Jeremy Phillips has no positions in the stocks mentioned above. The Motley Fool owns shares of Apple and Microsoft.Motley Fool newsletter services recommendApple and Microsoft. Try any of our Foolish newsletter servicesfree for 30 days. We Fools don't all hold the same opinions, but we all believe thatconsidering a diverse range of insightsmakes us better investors. The Motley Fool has adisclosure policy.

Copyright © 1995 - 2012 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.

Read Full Story

Want more news like this?

Sign up for Finance Report by AOL and get everything from business news to personal finance tips delivered directly to your inbox daily!

Subscribe to our other newsletters

Emails may offer personalized content or ads. Learn more. You may unsubscribe any time.

From Our Partners