Posted on 03/08/2008 6:38:32 AM PST by jdm
Bear Stearns analysts Andy Neff, Bill Hand and Ted Chung sent a note to clients this morning following Apple's (AAPL) announcement of a new developers' platform for the iPhone. Key excerpts:
WHY NOW? EIGHT COMPELLING REASONS. Despite current anxiety, we view current weakness in AAPL shares as an opportunity to add to positions based on our assessment of several positive inflection points:
1. WIDgets. With iPhone SDK launch today (3/6), AAPL further extended its lead in the emerging WIDget (Wireless Internet Devices: GPS, email, TV/video, social) market. Making media content portable is a 200mm unit (annual) market; making phones portable is over a 1bn unit market. WIDgets is somewhere in between.
2. VIDEO. Going forward it's not about music: it's about video. All the pieces are falling into place: AppleTV, video content, video rentals. Think non-linearly about an Apple TV-based HDTV.
3. INTERNATIONAL AT INFLECTION POINT. While Apple generates ~60% of sales from Americas, recent unit data points to acceleration in Europe, Japan & Asia.
4. MORE iPHONE MODELS, FEATURES. We expect to see more iPhone models (a la iPod), including 3G along with new features/apps in the coming months.
5. MAC MOMENTUM. With competitively priced products and growing mind share, we see continued momentum in Mac sales.
6. NEW iPOD DEMAND. It's no longer just about music, but it's about video & Internet access.
7. AND IT'S ALL SHIPPING. Three concurrent product cycles: Mac, iPhone, iPods with video coming on.
8. NOT ON HYPE-DRIVEN VALUATION. And the valuation (selling at 14x our CY09 op. EPS or 13x our CY09 cash EPS) is more reasonable.
· SEVERAL RISKS: Consumer spending particularly in the US/Europe (85% of sales). No single catalyst. Business model gets more complex with size. Are they innovating fast enough? Are they innovating too fast? Where are all those iPhones? Can AAPL keep beating expectations?
· NO EST CHANGES. We're maintaining our (reported) GAAP EPS for FY08 of $5.10, for FY09 of $6.50 and for 2Q08 of $1.08 (vs. $0.87).
· MAINTAINING TARGET. Given these multiple catalysts, we're maintaining our CY08 target of $220 using a 29x P/E on CY09 op. EPS plus $24/sh in net cash.
Leonard, While Freep is the home of conservatives it is also the home of some of the most mathematically challenged beings in the animal kingdom and your post points out on good example. THX.
1. Google phone
So, you would advise us all to short AAPL at this point?
Your reasons are weak IMO.
The vaunted Google phone is nothing right now. I've seen the demo's. It mayhave some success in the future, but in the end I don't think it will challenge the iPhone (BTW, Sergey Brin uses an iPhone and thinks highly of it). The SDK will make the iPhone the #1 smart phone in the world.
2. PC are better
3. Macs are for snobs
Do you know what the most profitable retail store chain in America is? That's right, APPLE. There is a reason Apple's stock has outperformed every other PC maker's stock by a wide margin in that last five years and that reason is they make the best computer products in the world. Right now Apple has about 200 retail stores. They will eventually have 500+ stores. That performance suggests that Apple products appeal to more than just the so called "snobs".
1. Google phone
2. PC are better
3. Macs are for snobs
Geez someone posts a thoughtful article and you post trash!
Yep. Every time something goes wrong.
Especially since the most common issue is something the IT department pushed to my computer, or some arcane setting change, buried 5 layers deep in dialog boxes.
OTOH, I call them up for help with some obscure feature of excel (such as properly formatting an internal rate of return function for 20 or 30 payments at non-repeating time intervals). This is a lot faster than me looking it up myself.
And then spend several hours a week per computer dealing with updates and other problems.
I have one PC and Five Macs, including a 12 year old G3. I can be working in seconds when I turn on my Mac. My PC takes several minutes to boot, then to check for new Virus software updates, then other updates, and on and on and on.
My Mac blowns any PC away in terms of power and ability. I’d actually have to spend more money to buy a PC equal in ability to my smallest Mac.
I have been in the IT industry since 1980...OS X is better. Macs are better. AIX, Solaris, HP-UX, and OS X. What do they have in common?
Macs are for snobs?.. Maybe they are for JAVA developers. Twit.
After 27 years you don’t have a clue about Macs? When you say twit are you commenting on your skill set... because if you think Macs are king I wouldn’t let you around my dogs electronic hair brush.....
But I do have a bridge to sell.
Trash... I’m not the one posting articles about Macs.... so what are you talking about?
“Do you know what the most profitable retail store chain in America is? That’s right, APPLE. There is a reason Apple’s stock has outperformed every other PC “
The same reason my neighbor bought a Prius and the other bought a Cadillac truck..... fads are good, they keep the economy rolling.
Why would you want to run OSX... you are better off running Edubuntu.
You pay WAY extra.. Way way WAY more than you wanted to pay and you KEEP on paying!
He forgot the multiple $120 per hour visits to a tech support provider when those machines fail beyond his ability to repair.
So someone wants to make a post about Apple being a good investment and you make a post trashing Apple and what am I talking about?
Gee let me think about that a bit.
Stock tout posts should not be permitted on Free Republic under any circumstances. This is not Yahoo.
HA! - I was a Navigation Technician back in the early 70s. 12 birds up; dual channel satellite receiver (AT&T) - about the size of a tower PC; a Nova or PDP-8; a generator and an antenna 6'X8” in an enclosed tube. Took multiple passes under 75 degrees and over 15 degrees (to the horizon) to get a fix within 100 meters. (I positioned offshore oil rigs and did geodetic survey work in SEA) Now I have an antenna/processor that fits in my hand and displays on my Palm and talks to me real-time. Tell me about it :-)
apple is a bad investment
I don’t know if you have seen iLife and the way it works together. Gotta have OS X - at least until someone else can make all of this work well together. My kids put together video scrapbooks all of the time.
And, I did some quick research on the web - sounds like you can run edubuntu on the mac in Parallels.
You have an electronic hair brush for your dog? You are a twit. OS X...it’s better than your dog’s electronic hairbrush. Oh and I want to buy your bridge...(twit)
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