“Bendgate” couldn’t have come at a worse time for Apple (AAPL), as it tarnished the ballyhooed launch of the iPhone 6 just as Apple stock comes up against multi-year technical resistance.
Throw in some embarrassing problems with an update to iOS 8 — Apple’s latest mobile operating system — and anyone holding AAPL stock is going to have to wait a little while for new all-time highs.
Apple stock fell sharply Thursday after users complained that the iPhone 6 Plus can’t keep its shape. After carrying the devices around in their pants pockets, some users discovered their iPhones bent or curved. Attempts to straighten the phones led to cracks in the body and shattered screens.
At the same time, a debacle over the first update to the new iOS 8 only made matters worse. Apple had to pull the update after it caused a range of problems for users iPhones, including losing cell service to disabling the Touch ID fingerprint sensor.
Apple Stock Twice Bitten
That’s a double-whammy if ever there was one, and it comes at a time when AAPL stock was poised to hit new highs. Indeed, the months after launching a new iPhone are historically some of the best times for Apple stock. On average, AAPL stock gains 23% in the six months after debuting a new iPhone.
At the same time, for the second time in a month, Apple stock is coming up against the resistance of its previous all-time high hit back in 2012. AAPL closed above that $100 level recently, but came up against resistance and failed to take it out definitively by building on gains.
Now that level seems farther away than ever. The bendgate fiasco has just started rolling and there’s no way to tell how much it will hurt iPhone 6 Plus sales, but it’s a black eye for Apple in any case. This kind of thing just doesn’t happen to Apple, which prides itself on build-quality as much as it does the elegance of its industrial design and software.
None of the recent problems should cause any lasting damage to Apple of AAPL stock. The iPhone 6 and iPhone 6 Plus still look good to deliver record sales figures for Apple. Shares will bounce back in relatively short order.
But these embarrassing developments move the perception of Apple a little further away from the burnished image of Steve Jobs’s company. AAPL stock has been laboring under a lower premium ever since the founder passed away. Bendgate and problems with iOS 8 sure aren’t going to get the market to pay more for Apple stock.
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As of this writing, Dan Burrows did not hold a position in any of the aforementioned securities.