) finished Monday's trading session down 3.57 percent to close at
$501.75 after briefly breaking below the $500 mark -- something
the stock hasn't done since February 16 of last year. The sharp
Monday drop stemmed from news that Apple had cut orders from its
iPhone suppliers (by as much as 50 percent) on the back of slower
than expected demand.
Later in the day, several bullish Apple analysts defended the
company, characterizing the information as old news. However,
that did little to quell investor concern that Apple may be
losing more market share than previously thought.
Apple might be the headline stock, but when it has a bad day,
the company often takes its suppliers down with it. Monday was no
Share of Cirrus Logic (NASDAQ:
) tumbled 9.37 percent to close at $28.62. Cirrus manufactures
chips for the iPhone with 60 percent of the company's business
tied to Apple. The company expanded its product offering but
still remains focused on Apple.
Although Cirrus and Apple have nearly identical beta, 0.92 and
0.93 respectively, laying a 1-year chart of Apple over a 1-year
chart of Cirrus reveals that the two companies move largely in
tandem. Likely due to investor fears of the company's reliance on
Apple, Cirrus is much more volatile.
LG Display Company (NYSE:
) was down 2.5 percent Monday to close at $13.59. LG manufactures
displays for Apple products along with Sharp (OTC:
The India Times
reported Tuesday that screen manufacturers are cutting back
production from 40 to 80 percent. Apple reportedly ordered 65
million screens for January to March delivery before making the
LG not only provides screens for mobile devices, the company
sells to manufacturers of laptop and tablet computers, GPS
devices, and automobiles. The diversified nature of the company
allows it to weather Apple's troubles, but that does not make it
immune to the Apple effect. LG was down as much as 3.5 percent in
Asian trading Tuesday.
) was down 1 percent to settle at $64.24 Monday. In premarket
trading Tuesday, the stock fell an additional 0.50 percent. The
company makes the 4G modem for the iPhone but unlike Cirrus,
QUALCOMM is not nearly as levered to Apple. Most of the major
manufacturers use QUALCOMM technology in their phones, making
shifts in market share largely immaterial to the company.
The chart confirms this. In the past year, QUALCOMM has traded
in a 20 percent trading range versus Apple's 63 percent range.
Apple has shown much larger volatility in a sector known for
being a swing trader's dream.
(c) 2013 Benzinga.com. Benzinga does not provide investment
advice. All rights reserved.
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