Apple Inc. (NASDAQ:AAPL) shares touched their all-time high of $705 in September 2012. But when the stock price began to fall, analysts and traders raised questions about the company’s business. They blamed declining profit margins and increasing competition for the stock price’s fall, which is down 12 percent this year so far.
However, according to a disclosure document filed with the Securities and Exchange Commission, some of the biggest hedge funds dumped Apple shares worth billions of dollars between September 30 and December 31, 2012, fueling a massive drop in the company’s share prices.
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Justin Walters, co-founder of Bespoke Investment Group said that a lot of people who unloaded Apple Inc. (NASDAQ:AAPL) shares will come back within three months to pick it again.
Leon Cooperman-led Omega Advisors sold 266,000 Apple Inc. (NASDAQ:AAPL) shares, the firm’s total position, during the fourth quarter. Hedge funds are required to disclose their holdings to SEC within 45 days of each quarter’s end.
Eton Park Capital Management, founded in 2004 by Eric Mindich, exited Apple entirely in the fourth quarter. Mindich had also sold some of the Apple shares in the third quarter.
Thomas Steyer’s Farallon Capital sold 137,000 Apple Inc. (NASDAQ:AAPL) shares during the period. Jana Partners of Barry Rosenstein also sold off its entire stake of 143,000 shares. Viking Global Investors dumped 1.1 million shares, and Lone Pine Capital sold 800,000 shares.
There were also a few funds that purchased Apple Inc. (NASDAQ:AAPL) shares amid the cash. David Tepper almost doubled his stake in Apple to 913,000 shares in the same period. George Soros also increased is holding to 184,000 shares. David Einhorn who sued Apple Inc. (NASDAQ:AAPL) last week for higher dividends, increased his holding in the company to 1.3 million shares by the end of December 31.
Despite the decline in Apple’s share prices, most of the hedge funds left the company with hefty profits because they had bought Apple shares when prices were too low.
For example, Cooperman and Rosenstein started accumulating Apple Inc. (NASDAQ:AAPL) shares in 2010, when the prices were below $300. The record selling of iPhone 4 devices sent share prices up by more than 50 percent over the next year.