This morning, Kathryn Huberty of Morgan Stanley, a known AAPL bear, cut her target price from $105 to $95 accompanied with nasty comments mostly due to lower unit sales for AAPL products reflecting the macro environment.
Too bad, traders just sell first and ask questions later. AAPL closed down about 2% while Nasdaq was up approx. 1% (QQQQ was unchanged...it is so evident that AAPL weighs so much on QQQQ).
Let me reminds you....she has been known as the worst AAPL analyst based on her track record. Andy Zaky has written extensively about her while ago:
And this link shows how far off her estimates have been:
Let's examine what was behind Huberty's action:
- AAPL was poised to take out $105 (her previous target price) on a good day, so she had to artificially take down AAPL in order to keep her job (as we all know the job situation in Wall Street where an incompetent analysts can be easily replaced).
- Timing is essential. AAPL finally broke out of 50 day moving average showing a favorable technical outlook. She needed to whack that good TA trend to make her point.
- Inspired by Meredith Whitney? Meredith always shows up when financials have a nice little rally...just to kill it. There are lots of companies that you cover produce products that nobody want to buy...like DELL.
Let me remind you, Morgan Stanley, AAPL's pocket change can buy you out right now...your market cap is less than $17BN. If you still think that you are a "tier 1" broker, try to have "tier 1" analysts, not someone considered the worst.
Jim Goldman wrote a very nice piece about her action. It is worth reading as always:
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