Our Terms of Service and Privacy Policy have changed.

By continuing to use this site, you are agreeing to the new Privacy Policy and Terms of Service.

Apple iPad sends stock down - then up

chart_apple_stock2.top.gifBy Julianne Pepitone, staff reporter


NEW YORK (CNNMoney.com) -- The debut on Wednesday of Apple's long-awaited tablet sent the company's stock on a wild ride.

Apple shares fell 4% immediately after CEO Steve Jobs unveiled the Apple iPad, a touch-screen tablet computer that runs apps from the iTunes store and boasts a 10-hour battery life.

But shares recovered a little over an hour later and rose 1% after Jobs announced that prices would start at $499.

The volume of trading was more than three times the normal daily average, reaching 61 million versus the typical daily average of 19.5 million.

"What this device does is extraordinary -- the best browsing experience you've ever had. Way better than a laptop," Jobs said as an invite-only event in San Francisco got underway.

But about 45 minutes into the event, the market was not impressed. Shares of Apple (AAPL, Fortune 500) slid as low as $199.53 before regaining some ground. By 2:25 p.m. ET, shares were up 1% and managed to hold those gains, ending the day at $207.88.

Historically, the company's stock price has lulled or sold off slightly immediately following product releases. Analysts have a median price target of $250 for Apple's stock.

Shares had been on a tear since the stock market's nadir in March 2009. On Monday, Apple reported a record sales rise of 32% to $15.7 billion in the first fiscal quarter of 2010, well above analyst forecasts. That marked the second straight quarter of record sales.

But some analysts caution that Apple shares could stumble, as the iPhone may start to see sales level off. Others are skeptical about the consumer appeal of a tablet, citing portability concerns and asking whether the device is anything more than a gigantic iPhone.

But Carl Howe, director consumer research at industry analysis firm Yankee Group, said Apple is able to post high earnings and should continue to do so because of three factors: unique devices, quality applications/services, and productivity.

"[Apple has] a have a great track record for making you want -- and buy -- things you thought you didn't need," Howe said. To top of page

Index Last Change % Change
Dow 21,674.51 -76.22 -0.35%
Nasdaq 6,216.53 -5.39 -0.09%
S&P 500 2,425.55 -4.46 -0.18%
Treasuries 2.19 -0.00 -0.23%
Data as of 12:50am ET
Company Price Change % Change
Bank of America Corp... 23.62 -0.02 -0.08%
Ford Motor Co 10.56 -0.08 -0.75%
Advanced Micro Devic... 12.37 0.03 0.24%
Foot Locker Inc 34.38 -13.32 -27.92%
Chesapeake Energy Co... 3.96 0.08 2.06%
Data as of Aug 18
Sponsors

Sections

Not only do many women depend on insurance coverage for maternity care and contraception, it commonly falls to them to plan health care and coverage for the whole family. Yet as leaders in Washington discuss the future of American health care, women have not always been allowed in the room. More

An open letter signed by the Tesla CEO and 115 other robotics and artificial intelligence experts urges the U.N. to ban the use of lethal autonomous weapons. More

Despite having more financial "skin in the game" than ever, many consumers don't make any attempt to compare prices for health care services, a newly released study found. More