April 17, 2013 at 11:43 AM ET
Apple accelerated losses, tumbling to its lowest level in over a year, as investors continued to dump shares of the tech company amid worries over second-quarter iPad mini shipments.
The once-darling tech giant of Wall Street shed nearly 6 percent Wednesday, breaking below $400 a share for the first time since December 2011, following a report from DigiTimes that iPad mini shipments could fall 20 to 30 percent quarter-over-quarter to 10 to 12 million in the June quarter due to "lacking demand in the market."
"We continue to see risks to [Apple's] consensus estimates, primarily with respect to the June quarter," wrote Edward Parker of Lazard Capital Markets. "June should be the trough quarter ahead of multiple new product introductions into this summer and into fall."
Adding to worries, Apple supplier Cirrus Logic plunged nearly 15 percent after the audio chipmaker estimated fourth-quarter revenue below Wall Street projections and first-quarter revenue forecast also fell short of expectations.
Other Apple suppliers including Qualcomm, Avago Technologies and Skyworks also traded sharply in negative territory.
Most recently, widely-followed Apple analyst Gene Munster of Piper Jaffray cut his price target to $688 from $767 based on the belief that the company will release a lower-priced iPhone, which will cannibalize higher-priced iPhone sales.
Munster also expects Apple's earnings to be weak and the guidance for the June quarter is going to be worse than expected. Still, he maintained his "overweight" rating on the stock. Apple is scheduled to post quarterly results next Tuesday.
Apple shares have vastly underperformed the broader market amid revenue concerns, plunging almost 25 percent year-to-date against the S&P 500's 9 percent rally. Apple shares have dropped a staggering 40 percent and wiped out more than $250 billion in market cap since hitting an all-time high of $705 a share back in September when the iPhone 5 went on sale.
"Clearly, it's been a rough six months for the stock," wrote Parker. "Sentiment has gone from bad to worse as the overhang from the disappointing December quarter call has been compounded by a steady stream of negative industry supply chain checks."
Still, Parker said he continues to like the company as a "storage" company has a "buy" rating on the stock with a $540 price target.
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