Is now the time to buy Apple?

Expert tips and advice you simply can’t afford to miss . . . Brave bargain hunters circle after share price crash

Apple has been one of the most consistent, fast-growing technology stocks on the planet. Customers had a seemingly insatiable appetite for its latest gadgets.

on the stock market, its value almost doubled in five years and last year it became the first trillion-dollar company, albeit briefly.

Which is why the iPhone maker’s dramatic fall from grace this week created such profound shockwaves.

on thursday, its shares plunged 10pc, knocking nearly £60bn off the market value, after it warned sales of iPhones and other devices were falling below expectations.

But the big question for investors now is whether this is an opportunity to snap up shares in Apple for less – or whether there is worse to come.

Chief executive tim Cook blamed an economic slowdown in China for the disappointing sales.

that left shareholders wondering whether they can still rely on the tech titan to add money to their savings. their ranks include many small Uk investors who have bought shares directly or through an investment fund.

As Cook suggested, luxury goods companies including Apple rely increasingly on China’s middle class to buy their products.

his warning that this audience might be tightening the purse strings wiped billions of pounds off companies such as Burberry and kering, which owns gucci.

nasty surprise though it was to many, Cook’s bombshell did not come completely out of the blue.

Apple had warned its revenues for the first quarter would be about £70bn, lower than expected. on thursday, that fell to £67bn.

Some saw it coming. hSBC analyst erwan rambourg had downgraded Apple from ‘buy’ to ‘hold’. he said: ‘ nearly 35 years after Apple’s 1984 hardware revolution, another one is needed’. In his view, it is ‘too late to sell, too early to buy’, as it is changing from a fastgrowth business to one with stable or even low revenue growth. But some think the drop in the shares could present investors with a canny buying opportunity.

Atlantic equities analyst James Cordwell says Apple appears to have indicated to shareholders that although the iPhone has driven stellar growth for a decade, that has ended. But he added: ‘Consumers are not abandoning Apple’s ecosystem, just upgrading phones less often. this creates the opportunity for a new chapter in the growth story, focused on selling services to its loyal customers.’ He envisages a possibly volatile ride in the short term as the company shifts emphasis from selling iPhones to focus on sales of music and cloud storage.

he added: ‘We believe the company will ultimately successfully reorientate, bringing rewards for shareholders with the patience to stick with their investment through the transition.’ Apple has £187bn of cash in reserves. excited observers have speculated some of this could be returned to investors through special dividends or share buybacks. It announced a £79bn buyback last year and upped its dividend 16pc to 73 cents per share.

But with critics calling for a ground-breaking new invention, the Silicon Valley darling may have more urgent projects. Founded by Steve Jobs and Steve Wozniak in 1977, Apple overtook computer firm Microsoft by value in 2010.

It released the first iPhone in 2007, and last February announced there were 1.3bn active users – 17pc of the world population.

Apart from China, another factor depressing growth may be that customers cannot afford to upgrade their iPhones or buy into the brand if they don’t already own a device. Apple’s most expensive iPhone, the XS Max, now sells for a whopping £1449.

toni Sacconaghi, from investment firm Bernstein, wrote to clients: ‘iPhone prices are nearly five times higher than the average non-Apple smartphone. Perhaps Apple failed to acknowledge the possibility that current iPhone prices are simply too high.’ this isn’t the first time Apple has suffered due to scepticism over its growth prospects. In January 2013, the stock fell more than 10pc amid evidence that demand for its products was slowing.

Sacconaghi thinks it may not yet be time to buy since the shares have historically only stopped falling once analysts’ estimates have all reached rock-bottom.

estimates may be revised lower as Apple prepares to release results later in January.

British investors may be best off sitting on their hands.