Apple Earnings

Apple Inc. (NASDAQ:AAPL) announced its earnings today amid fierce speculation and volatility as investors awaited the report. The company announced earnings of $12.30 per share on revenues of $39.2 billion for their second quarter of 2012, the period between January and March. The company’s stock has been cartwheeling lately amid fears of a change in its fortunes.

Analysts were looking for earnings per share of $9.99 on revenue of $36.7 billion. Apple Inc.’s (NASDAQ:AAPL) own forecast was much lower at $8.50 per share and revenue coming in at $32.5 billion.

In the same period in 2011 the company took in revenues of 26.7 billion with per share earnings of $6.43. No matter hoe the figures came out today the company were going to do phenomenally year on year.  The company’s growth has been stelar but that isn’t the real problem with the company. Concerning investors in recent weeks has been the price of the company’s stock.

Discombobulated is the only word to describe investor’s relationship to the company’s stock in recent weeks. The company hit a high of 644 in on April 10th then gradually slid to a close of just over 605 on April 13th. In the next day of trading the company dropped twenty five points to 580 leaving holders of the stock in disarray. By April 18th it seemed recovery was on the card as the stock once again climbed over 620 but it has since fallen to new lows today trading at 560.28 when the market closed.

The volatility of the company is not based on today’s earnings report, which most assumed would be in or around what had been expected, but concentrates more readily on the future of the company through to the end of 2012 and existential angst about the value of the company.

As the world’s most valuable company, passing the $600 billion market cap not so long ago, there exists a downward pressure as investors wonder how sustainable it is. Exxon Mobile, the second most valuable company, has a market cap of under 410 billion. Apple’s still a fifth more expensive, even with today’s lows, at just over 522 billion. Investors are questioning Apple’s sustainability in a fickle marketplace.

We are not seeing a run from Apple’s stock but a questioning of its value by investors. The question is a big one judging by the magnitude of the stock’s spread. It has shed 13% of its value in the last two weeks. That change in any other stock would cause near eulogies but Apple investors are still questioning.

Any looking for answers will have to look beyond today’s earnings. The perceived problems in the firm’s business lie in other hands, those of the major carriers and competitors. Though much meaning will be drawn from the first quarter’s numbers they have not accounted for the fall. Investors need to find their answers elsewhere.

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