What Apple Needs Now


Jim Jubak Image Jim Jubak Founder and Editor, JubakPicks.com

Apple's disappointing earnings report has triggered a barrage of negative coverage in the financial press, and MoneyShow's Jim Jubak, also of Jubak's Picks details what needs to happen for Apple to reclaim its former star status.

So exactly why are Wall Street's knickers in such a twist over Apple's first quarter fiscal 2013 earnings reported Wednesday?

Make no mistake-they are in a twist. The stock closed down $63.51 a share Thursday. That's a lot even for a $500 a share stock. The loss amounted to a drop of 12.4% for the day.

Apple's crimes?

No year-to-year earnings growth in the quarter. Apple (AAPL) reported earnings for the quarter of $13.81. Although that was 26 cents a share better than the Wall Street consensus, it was still below the $14.03 a share the company reported in the first quarter of fiscal 2012 back in January 2012.

Lowered guidance for the second quarter of fiscal 2013. The company told Wall Street to expect revenue for the quarter of $41 billion to $43 billion against the $45.94 billion Wall Street consensus. Gross margin for the quarter would be 37.5% to 38.5% instead of the 40.5% Wall Street expects.

And most important of all, a lack of catalysts to make investors want to buy the stock.

Why do I call this "most important"?