Apple stock implosion shreds $113.4B

August 05 01:08 2015

Apple (AAPL) shares are down significantly for the second day Tuesday – bringing investors’ paper losses staggering levels and putting the stock further into correction territory. It’s the stock’s third five-day losing streak in the past month – knocking the stock down 7% in just that time, says Bespoke Investment Group. The stock is down further from its average price the past 50 days and it’s been in 12 years, Bespoke

Shares of Apple are off $3.07, or 2.6%, to $115.32 Tuesday – meaning they’ve fallen 14.3% since hitting their high of $134.54 on April 28. Given the massive size of Apple’s market value – this selloff is enormous in that it has wiped out $113 billion in paper wealth. The selloff essentially erases more than the entire market value of corporate giants including Nike (NKE) at $98 billion or McDonald’s (MCD) at $95 million, separately.

Investors are fretting over evidence that competition is heating up for smartphones in China, which is seen as the last big market of growth for the company. Meanwhile, here in the U.S. smartphones are already saturated and are priced as a replacement market, much like personal computers. Apple continues to try to keep average selling prices high – north of $600 per phone – as competition is only intensifying and more computing is done by the cloud, which is agnostic to the device. Investors worry the company could have difficulty putting up the massive revenue gains of the past year – if smartphones prices fall or demand in China softens. There have also been reports of new malware that target Macs – eating away at the company’s long-standing claims it is largely immune from such security threats.

Apple continues to be the most valuable company in the Standard & Poor’s 500 with a market capitalization of $657.6 billion – but it’s leadership in the stock market is fading away. Shares of the gadget maker are up just 3.9% this year. Shares of online advertising services, Google (GOOGL) and Facebook (FB) are up 26% and 21% this year respectively.