Apple Inc. (NASDAQ:AAPL) shares are heading back up toward $450 a share again, posting almost 6 percent or $20+ in gains during the regular trading day on Wednesday. What a difference low expectations make!
It would seem all we have to do to give a stock a boost is set expectations extremely low for it, and then when the company shows some signs of success, the stock will take off again. Just take a look at Netflix, Inc. (NASDAQ:NFLX), which also came in ahead of consensus on earnings per share but ended up getting pounded because of other worries.
Apple is consistent
Time writer Sam Gustin focuses on just how far Apple Inc. (NASDAQ:AAPL) has gone in the almost two years since co-founder Steve Jobs passed away. Samsung has begun to take a bite out of Apple Inc. (NASDAQ:AAPL)’s smartphone market share, and Apple Inc. (NASDAQ:AAPL)’s stock has fallen 30 percent since last summer as investors begin to wonder whether the company has another great product up its sleeve.
Gustin reports that a year ago he asked if Apple Inc. (NASDAQ:AAPL) “was starting to lose its shine,” and of course Apple Inc. (NASDAQ:AAPL) fans jumped to the company’s rescue. But we are still waiting for the next great product. Nonetheless, waiting, for a company like Apple Inc. (NASDAQ:AAPL), can be quite profitable, as he reports.
Apple had record iPhone sales in June
Investors were especially concerned about iPhone sales for the June quarter, especially in light of weak demand for the newer Galaxy S4 handset. But Apple Inc. (NASDAQ:AAPL) managed to set a new record of more than 31 million iPhone sales in the June quarter this time around, likely driven by deep discounts on older iPhone models. Analysts were concerned about the lower than expected average selling price for the iPhone, which was less than $600, but overall, Tuesday’s report was judged by most to be a very positive one for the company. After all, the bar had been set very low.
Is it really so bad that Apple Inc. (NASDAQ:AAPL) hasn’t released a major new product any time recently? Perhaps not. After all, the company is exceptionally profitable, and at the end of the day, what Wall Street likes most is piles of cash, which Apple Inc. (NASDAQ:AAPL) certainly has.