On Wednesday, January 14, the day Apple CEO Steve Jobs announced he would be taking a 6-month medical leave of absence, Apple shares closed at $85.33. From the moment that news hit the tape, shares began to slide, and by January 20, Apple had dipped to $78.20, with investors starting to worry that a kind of China Syndrome was happening to the company.A complete meltdown, and no recovery. But something bordering on miraculous has occurred since then: a rally, and a big one, in Apple shares. And it was ignited by the most unlikely of sources: financial fundamentals.
This is a good example of how the unknown is sometimes too much for investors to take, and how quickly they can react negatively to bad news prior to getting the facts. Once the reports were in on the financial stability of the company, the stock price jumped above $100 US for the first time this year. As of closing of the markets on Friday the stock had settled at $99.72 US rewarding the strong sales numbers Apple posted. It sure doesn't hurt having $28 billion US in the bank either!