NASDAQ:AAPL – Apple Shares Take A Roller Coaster Ride This Week

Looking at the chart for Apple shares this past reminds me of a roller coaster that I just rode at Hershey Park in PA. Massive ups and downs – sharp declines followed be even sharper inclines. There is no doubt that Apple shares have had a tumultuous week.

Even so, Apple shares (NASDAQ:AAPL) closed the week out down only 3.74% which is not much off the mark of the entire NASDAQ which closed down 3.11%.

Apple had a lot of criticism flying in its face this week over the iPhone 4 antenna and signal strength issues. It got so bad at one point that the Senator from New York, Chuck Schumer, chimed in with his own criticisms of how Apple and Steve Jobs were responding to the issue.

Read Chuck Schumer’s letter to Steve Jobs here.

I expect Apple shares to rebound this coming week due to a favorable press conference that Steve Jobs had today with the press. During the press conference, Mr. Jobs discussed the iPhone 4 antenna issues, admitted there were problems, and offered solutions to iPhone 4 customers. Ultimately, he let customers know that Apple is going to do everything they can to ensure that their customer base is 100% satisfied with the iPhone 4. And this message of clarity, direction, and leadership from Steve Jobs will probably allow Apple shares to shed some of the jitters it experienced this past week.

Here is what some analysts have to say right now about Apple shares:

Analysts try and prepare investors for the fallout from today’s call.

  • Gene Munster at Piper Jaffray believes that Apple’s press conference increases the likelihood of an iPhone 4 modification going forward. This change in manufacturing could disrupt sales in the September quarter, impacting EPS by $0.38. If there is no modification and Apple replaces existing iPhone 4’s, this would result in a $1 billion one-time charge which he sees as an investment in the brand. He maintains his Overweight rating.
  • Shaw Wu at Kaufman Brothers believes that a full recall is unlikely even though checks indicate the company is exploring hardware and software fixes. Fortunately, the “death grip” appears to impact a small set of users, meaning financial impact is likely to be immaterial. Most investors will likely treat it as one-time item anyway. Shaw believes we will look back at this as a minor blip months from now. He maintains his Buy rating.
  • Mike Abramsky at RBC Capital believes there is now a higher probability of a repair or recall. Firstly, a press conference is unprecedented for Apple. Secondly, Apple’s online store shows iPhone 4 availability now in 3 weeks (from 7-10 days a few days ago) possibly implying a transition in production. He reiterates his Outperform rating.
  • Analysts feedback via Business Insider.