Apple’s (NASDAQ:AAPL) bear-territory brushes are clearly immaterial to Topeka Capital analyst Brian White, who reiterated a price target on the stock on Thursday that is more than double current trading levels. White’s target of $1,111 comes on a day when Apple is down more than 2.6 percent at around $543. That is more than 22 percent below the height of $702.10 that the shares reached on September 19. Bear-market territory is considered a decline of at least 20 percent from peak to trough.
White said the current trend simply represented a correction. “Similar to other corrections in Apple’s stock, the fears in the back of investors’ minds come to the forefront and the bear stories gain credence,” White wrote in a note to clients on Thursday. “We have heard it before, we’re hearing it now and we expect to hear it again in the future. However, these concerns have proven dead wrong over the years and based on the product lineup at Apple, we believe they will be dead wrong in the foreseeable future.”
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White points out that the drop is similar to three other corrections seen by Apple in the past 13 months — falling 16 percent from September through October last year, 15 percent from October through November 2011, and 19 percent in April to May this year. “Apple’s stock has clearly been under selling pressure in recent weeks as the negative news cycle has accelerated and the Apple bears are now making the case for why the company has lost its edge,” White added.
He also said that tax-related selling was hurting the stock price, with investors preparing for the upcoming fiscal cliff by selling now. Taxes on investment returns and dividends are set to go up at the start of 2013 unless the government works to prevent the automatic switch.
However, heading into the traditionally positive holiday season, Apple was likely to recover fast, White said, adding that this was an opportunity to buy. “We believe that those investors that have missed the Apple rally over the past year are presented with a very attractive entry point heading into the strong holiday news season,” he wrote. “The iPhone 5 and iPad mini are blockbuster new products that we believe will prove to be big hits this holiday season and into 2013, combined with the new iPad, MacBook Pro, iMac, and iPod lineup.”
Apple stock remains up more than 35 percent this year.
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