Apple Bears, Assemble!

In missing estimates for three recent earnings reports, technology giant Apple invites the slew of bears to come raging out of the woodwork and proclaim the demise of the company imminent. It's about as useful a proclamation as the ones from the Apple ultra-bulls who believe the company will usher the human race into the next era of technological revolution and cure all disease. Now, with the company's announcement of two major executive departures, bears will without a doubt be in full force as the markets resume trading tomorrow. I haven't been too big of a fan of Apple for some time, but I dread the impending argument that will come out of this. No, Apple is not sinking into oblivion, and no, Apple isn't the greatest company in the world.

By taking a rather middle-of-the-road stance on Apple (NAS: AAPL) , I will likely enrage both fans and haters of the iconic iCreator. But when a company becomes the subject of obsessive analysis and chatter, it tends to yield extremists, and each side of the argument becomes overinflated. Here at the Fool, we certainly have our fair share of Apple bulls and bears, and everyone likely raises a good point here and there. As for now, with the company disappointing investors in its third-quarter earnings report, then firing two major execs, the bears will definitely have the louder roar. Before it gets too deafening, though, let's remind ourselves of the bigger picture.

Apple is still a fantastic company that knows how to make something people want. If you thought its tremendous sales gains year over year were going to last into eternity, I'm sorry the wake-up call has interrupted your fantasy. As for the two executives that were let go, it isn't the most encouraging news, but people get fired, people leave jobs -- these things happen, folks. When people romanticize a company to the extent they have with Apple, anything but great news is apocalyptic. Take a step back, and think about where the company remains regardless of the management shakeup.

New products, new blood
They just announced the iPad Mini. We all argued over whether the iPad mini was priced right, how it would compare with Google (NAS: GOOG) and Microsoft (NAS: MSFT) products, and if it would reach the popularity of the original iPad. Might I suggest we alleviate some of these relative comparisons and look at the situation from a more absolute level? The iPad Mini doesn't have to be as earth-rattling as the original iPad was -- that already happened with ... the iPad. Google's Nexus tablets will continue to push on Apple's market share, and Microsoft's Surface will likely join in on the party in some menial way, too. Competition is healthy, and Apple isn't supposed to be the monopolistic provider of tablets; that's illegal. So, let's take a deep breath. The Mini still sold out fast, and it will make bundles and bundles of cash for Apple.

With the exit of Scott Forstall, who was a longtime engineer for the company, investors are yelling about the unrest taking place at the headquarters. First of all, let's keep in mind Forstall's Apple Maps was one of the worst things ever to come out of that company. Secondly, he did a great job at Apple and was instrumental in bringing the company to its market leading position. But time moves on, and there will be more talent down the line. The world did not end with Steve Jobs' passing, and the world will not end with Forstall finding another job.

Actual bad news for Apple would look a little more like Foxconn shutting down because of its egregious human rights violations, or people realizing that Apple's products are overpriced now that competitors have caught up to the idea of good design and function. These are real, long-term issues that could spell trouble for the company and its fantastically high margins.

Apple bears, if you want to find a company to short all the way to the bottom, look at a company like Splunk (NAS: SPLK) . My good friend and fellow value investor Zack Buckley delivered a convincing report at the recent Value Investing Congress laying out myriad reasons Splunk is heading into strong headwinds with a drastic overvaluation. Now that's a company that has no moat and will certainly struggle. Even if you are right about Apple, the market will remain irrational far longer than you will remain solvent. Cliche, but true.

As for you, Apple bulls, choose to see this as a reminder that Apple isn't the demigod of corporations; it's just a very successful corporation that has enjoyed a great period of success. Remember that there are many, many other companies out there doing great things.

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Fool contributor Michael B. Lewis has no positions in the stocks mentioned above. The Motley Fool owns shares of Apple, Google, and Microsoft. Motley Fool newsletter services recommend Apple, Google, and Microsoft. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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