JMP

The day Apple landed in Gauna

March 17, 2011: 7:18 AM ET

Why did one of the world's fastest growing tech companies fall twice as fast as the market?

Boy. You leave town for one day and -- if you'll forgive an expression Elmore Leonard warns writers never to use -- all hell breaks loose.

Of course, with Japan's nuclear plants burning and the Dow dropping 242 points and change, you would expect Apple (AAPL) to take a hit. So some of its $15.42 drop Wednesday (on top of Tuesday's $8.13 loss) can be attributed to the rout that drove the whole market down.

But the Dow only fell 2.04% Wednesday. Apple's shares had their third worst day ever in dollar terms, falling 4.46% before the market closed and losing another 0.94% in after-hours trading. By the time the high-frequency traders had done their worst, a company whose revenues grew 70.5% last quarter was trading -- when you subtract out its massive cash holdings -- with a forward P/E ratio in single digits.

So forgive me if I place some of the blame for what happened Wednesday on an analyst named Alex Gauna at JMP Securities. I never thought much of Gauna's work -- his Q4 2010 predictions were among the worst of 38 Apple analysts Fortune surveyed (see here) -- but he really distinguished himself Wednesday by downgrading Apple and casting aspersions on its product sales even as customers were still (five days after launch) lining up outside Apple Stores in the early morning hours to buy the latest iPad.

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