Apple's stock didn't deserve to drop

1) Apple just finished the year with more profits than have been made by any company in the history of the world.

2) It added $13.1 billion to cash reserves, bringing its total to $167 billion.

3) It had massive increases in iPhone and iPad sales year-over-year, including 10.8 million (29%) more iPhones than the same quarter last year and 7.5 million (49%) more iPads.

4) With the exception of Samsung, all its competitors in smartphones are barely breaking even or are losing money. It still wins about two-thirds of all profits in the smartphone market segment.

5) It makes more profit selling traditional computers than either HP or Dell.

6) It has a price to earnings ratio of 11.7. This compares to 358.5 for Netflix, 3,583 for Amazon, 22.8 for Google, 286.5 for Facebook, and 14.9 for Microsoft. The annual profit of these five other companies combined is about two-thirds of Apple's profit.

So, the market responds by dropping Apple's market capitalization by $50 billion, roughly the value of Nokia, RIM and Sprint combined.