AAPL Down Vs. The Market
Oil prices jumped to 30-month highs above $108 a barrel today as the conflict in Libya extended market concerns about supply risks. However, signs of a recovering U.S. jobs market is bolstering optimism with the broader markets inching moderately higher in early trading. Shares of AAPL are down on continued supply chain fears and Steve Job health worries. Upcoming catalysts for the stock include first calendar quarter earnings the third week in April; any update regarding
Steve Jobs' healthy return; the WWDC slated for June; monthly NPD data to gauge Mac /
iPod businesses;
iPad 2 sales updates;
iPhone sales updates, the push in China, as well as the launch of the
iPhone 5 (whenever that may be); new revenue streams such as video, books / publishing and social (
Ping); moving
iTunes into the cloud; and the continued evolution and adoption of
Apple TV. Shares of
Apple trade at
13x Enterprise Value / Trailing Twelve Months Free Cash Flow (incl. long-term marketable securities).
Analyst Ups Price-Target While Taking Down iPhone Gross Margin (Barron's) Canaccord Adams analyst Mike Walkley reiterated a Buy rating on Apple shares, raising his price target to $480. He, however, also lowered his gross profit margin and his
iPhone unit assumptions for this fiscal year, based expectations the
iPhone 5 may be pushed to a September introduction, thus bringing in some revenue next year originally expected this year. Walkley dropped his EPS estimate for the year about 20 cents to $22.74 but raised his EPS estimate for 2012.
Read » Android Is Crushing The Smartphone Market; Increases Lead (TechCrunch) comScore released smartphone market share data for November 2010 through February 2011 which showed
Android increasing its lead as the top mobile platform, growing 7 percentage points and strengthening its top position with 33% market share. The
Verizon iPhone helped Apple push its three month average percentage of mobile subscribers, reaching to 25.2%.
Henry Blodget at Business Insider believes that Apple fans should be scared to death about Android.
Read » Nokia Smartphones Powered By Microsoft Will Equal Trouble For Apple (The New York Times) Nokia remains the largest phone manufacturer in the world, and it has no equal in building handsets inexpensively. Last year, it sold more than 452 million phones, including 100 million smartphones.
Microsoft launched
WP7 in the fall last year and by year end had 5,000 apps in its store, a milestone reached 3x as fast as Google’s
Android. Symbian is the second largest smartphone platform in the world at 20.9% with WP7 at 5.5%. That spells trouble for Apple’s 15.7% share.
Read » Sony CEO Says iPhone 5 Components Delayed By Japan Earthquake (CNet) While discussing the Japanese earthquake,
Howard Stringer CEO of
Sony noted that Sony's camera sensor plant in Sendai had been affected and that shipments of 8 megapixel camera sensors to Apple for Apple's iPhone 5 were subsequently delayed. Well that's interesting because both the 5-megapixel camera on the iPhone 4 and the 3.2-megapixel device on the iPhone 3GS have been supplied by OmniVision. This also lends credibility to the persistent rumors that the iPhone 5 will be delayed until fall.
Read more at Business Insider.
Read » Reasons To Sell Apple Stock Not Based On Fundamentals Or Valuation (Seeking Alpha) Apple has become Wayne Gretzky. There will never be another Gretzky. Investors have priced the stock beyond perfection; from a psychological standpoint, not from a valuation one. Apple's problem is not just that investors expect big things from the company, but they take them for granted. If Apple misses earnings, it's like Alex P. Keaton coming home with an 'F.' It has become pointless to even attempt to invest in Apple based on fundamentals or valuation, because the company no longer plays by the same rules.
Read » Apple's Dominance Leads To CEO Resignations (AppleInsider) Apple's
iPad and iPhone continue to shake up the netbook and smartphone market, producing a chain reaction of events that has led to the resignation of CEOs from three major electronics manufacturers over the last six months:
Acer,
LG and
Nokia. These three companies have failed to launch product lines that are able to compete sufficiently;
LG and Nokia in the smartphone market and now
Acer in the netbook and tablet market.
Read more at Business Insider.
Read » How Apple Can Rise Above Exxon (Barron's) When and how could Apple elbow
ExxonMobil aside as the biggest U.S. company by market capitalization? Basically the stock needs to rise roughly 30% to $450 a share to become the top dog (all things being equal with Exxon). Apple would have to produce something on the order of $31 per share in earnings, assuming its cash per share rises to more like $86 in the coming year. Projected EPS next year is around $26. So, it's not impossible.
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