(By Street Authority)In the mid 1980s, my favorite band was R.E.M. At that time, they were the kings of college radio and snotty rock critics. But high school kids were still using Van Halen, Loverboy and Journey as their soundtrack for getting in trouble. When classmates would kid me about listening to the weird, minimalist music that they didn't play on commercial radio, however, I would simply reply, "Yeah. Just watch. There'll be an R.E.M. tape in your collection by the time you come home for Thanksgiving break of your freshman year of college."
I was at a party during Thanksgiving break of my freshman year of college. One of detractors came up and thumped me in the sternum. "You were right about R.E.M.!"
The herd had caught on.
R.E.M. went on to a major label, multimillion-dollar deal and became mainstream. I still liked R.E. M., but it had grown beyond being an outlier band from Athens, Georgia. Their output changed, perhaps dictated by a much bigger audience.
It's similar to what's currently happening to Apple's (Nasdaq: AAPL) stock price. It's no longer moving based on fundamentals.
The herd is in control.
When this happens, numbers get ahead of themselves. The good money has been made. Now, we're entering the phase when money can, and probably will, be lost.
The inmates are running the asylum...
If I had the time to count how many times the movement of Apple's stock price was analyzed ad nauseam by talking heads and guest pundits in one day on CNBC, then I'm sure I could fill up at least one yellow legal pad with tally marks. Is this because Apple's price movement is vitally important to the overall health and well being of financial markets? No. TV programming is steered by what viewers want to see. And everyone's interested in everything Apple. Therefore, the talk will be everything Apple.
No one has to convince me that Apple is an amazing company. It is. Its products are cutting-edge. But the stock can only run so far.
Here are three reasons why it may be time to take some of your money off the table, if you own shares.
1. Expectations are too optimistic -- In a research report dated April 17, 2012, Credit Suisse analysts reiterated their "outperform" rating with a 12-month price target of $750. They also expect iPad sales to grow by 66% to 66 million units, compared with last year's 40 million units.