How ironic that on a day when Facebook shares hit a new all time low, Apple shares finished at a new all time high.
The surge, however, has not helped Facebook, whose shares fell to $19.05, the lowest level since the company went public in May.
Maybe you’ve forgotten by now, but back on July 25, Apple shares hit an air pocket, falling $25.84, or 4.5%, to $572.51, after reporting disappointing results for the fiscal third quarter ended June.
Apple finished the day with a market cap of $607.5 billion, the company’s first close over the $600 billion market cap level.
Well, anticipation of new products – and the earnings riches the Street expects to follow.
Apple missed Wall Street’s expectations last month, but excitement is building over the expected releases of a new iPhone, an iPad mini and a long rumored Apple TV product in the coming months.
(Keep in mind that Apple has not commented to date on any of them.) Analysts expect all three products to boost revenues by the tens of billions of dollars.
That raises an obvious question: Should you be swapping your Apple shares for Facebook shares.
Facebook still faces enormous additional supply coming into the market as post Initial public offering lock up agreements covering well over 1 billion shares expire in the coming months.
As the Merc’s Brandon Bailey reported, the price could drop further if employees and insiders flood the market by selling their shares at the first opportunity: More than 1.5 billion more shares will be eligible to be sold by Nov.
Facebook also continues to face serious questions regarding its strategy on mobile devices.
Apple has a P/E of 11.8x estimates September 2012 fiscal year earnings, and 4.4x expected revenues.
Facebook trades for a P/E of 38.9x estimated 2012 profits, and 8.3x expected 2012 revenues.
Lewis Joyce is a business journalist based in Gold Coast, Australia. Lewis has a passion for financial markets and breaking news stories and loves writing about business news, stock market, and economic opinions that matters most to its audience. Lewis spends a lot of time discovering and researching latest financial markets and industry news stories in order to make sure the latest and greatest stories are brought to you first on BigBoardNews.com.
