Apple (AAPL) is in an unusual situation: investors are expecting the worst.
You've no doubt heard of the plunge in the company's stock. There are lots of reasons why, but here are two of the keys: Apple is expected to post a drop in earnings when it reports quarterly results after Tuesday's closing bell. And critics say that innovation has stalled.
Analysts polled by Thomson Reuters expect an 18 percent decline from a year ago. That would the company's first drop in more than a decade.
There have been lots of hints of Apple's malaise recently. Several key suppliers have missed their earnings targets, because of falling sales to Apple.
There's growing concern that demand for Apple's key products – the iPhone and iPad – has been weakening. That's partly because of stiffer competition from Samsung (SSNLF) and Google's (GOOG) Android-based devices. And Samsung is expected to start selling its new Galaxy 4 smartphone next week.
Basically, the shine of invincibility has worn off. That seems to have been happening ever since the death of Apple's iconic founder Steve Jobs back in 2011.
Analysts say that Apple needs to show it can once again be the innovative company that made its stock the most valuable in the world.
But most Apple watchers do not expect any new product announcement when it releases earnings tomorrow.
The company is well-known for its secrecy and rarely gives much advance notice about new product launches.
Still, there's plenty of speculation about Apple TV, the next generation of the Apple 5 iPhone, and the hope of true believers that Apple still has something big in the pipeline.
Reuters reports the iPhone update may be delayed several months because of design problems. It says Apple is working on a fingerprint sensor.
In the meantime, Apple may try to placate investors in the near term with a dividend hike or a special payout. It certainly has the money – $137 billion in cash and investments at the end of 2012.
Apple's stock is higher this morning, but still trading below $400 a share. That's down a whopping 42 percent from the all-time high of $702 a share, set last September, when Apple was considered a surefire bet.
–Produced by Drew Trachtenberg