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Apple's Shares Hit By Fidelity Selling And Lower US iPhone Share

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On Monday Apple shares were down $13.75 or 3.1% to $428.91 largely due to Fidelity’s $92 billion Contrafund decreasing its Apple’s holdings by 10% from 11.56 million shares to 10.43 million and Kantar’s latest survey showing lower US smartphone market share for Apple.

Kantar released smartphone market share data for the three month average ending in February which was negative for the iPhone in the US and positive for Android.  Microsoft’s share has also started to increase from about 2.7% in the fourth quarter last year to 4.1% in the February.

Key Takeaways: While the Contrafund’s 1.1 million share holdings cut is only about 0.1% of Apple’s total shares and would be about 0.1% of the shares traded during the first two months of this year, it is another negative sentiment impact to the shares.   I would say the decrease in Kantar’s estimate of Apple’s iPhone US share from a high of 53.3% in November to 43.5% in February is a more meaningful number as it shows that after an initial pop from the iPhone 5 it is losing share to competitors.  It is also lower than the 47.0% share it had in February 2012.

US

Oct. 28, '12

Nov. 25, '12

Dec. 23 '12

Jan. '13

Feb. '13

iOS

48.1%

53.3%

51.2%

45.9%

43.5%

Android

46.7%

41.9%

44.2%

49.4%

51.2%

RIM

1.6%

1.4%

1.1%

0.9%

0.7%

Symbian

0.3%

0.2%

0.1%

0.1%

0.1%

Windows

2.7%

2.7%

2.6%

3.2%

4.1%

Others

0.6%

0.6%

0.9%

0.5%

0.4%

Total

100.0%

100.1%

100.1%

100.0%

100.0%

Source: Kantar World Panel

In mid-2012 Apple was widely held by all types of funds and retail investors.  Besides falling short to very high expectations starting with the June quarter there wound up being few additional buyers of the shares.  One small positive is that holdings by funds have decreased so that when (and hopefully not if) Apple announces new products that can move the financial needle and/or beats expectations the shares can meaningfully rally since it is not as widely held.

Another small positive is that Apple continues to gain share in Urban China.  Kantar estimates that Apple’s smartphone share has increased from 19.9% in October 2012 (on a three month average) to 25.8% in February.  Apple’s higher share has come at the expense of Symbian and Windows.

Urban China

Oct. 28, '12

Nov. 25, '12

Dec. 23 '12

Jan. '13

Feb. '13

iOS

19.9%

19.2%

21.9%

23.2%

25.8%

Android

67.5%

72.2%

72.5%

71.5%

68.7%

RIM

0.1%

0.0%

0.0%

0.0%

0.2%

Symbian

6.2%

4.1%

3.9%

3.5%

3.1%

Windows

4.2%

2.7%

0.9%

1.2%

1.4%

Others

2.2%

1.8%

0.9%

0.6%

0.8%

Total

100.1%

100.0%

100.1%

100.0%

100.0%

Source: Kantar World Panel

Disclosure: My family and I own Apple shares