Discussion in 'Stocks' started by NY_HOOD, Dec 15, 2008.
downgraded to neutral from buy. i said for that past 6 months AAPL was going to 65.
And a timely call it is! Good thing they waited for it to drop from the $180's. You sure don't want to be too early in a downgrade.......need to wait for confirmation. Amazing how accurate these guys are
I wonder how low it has to get for a "sell"?
The Iphone is a nice phone, however, there are many other alternative phones out there. There is a whole new line of 8 megapixel hybrid camera phones with so much new technology. Also, who is going to buy any new Apple products when they either have lost their jobs or are worrying each day if it will be lost?
Plenty of people. I was watching a documentary on credit card. The host interviewed a group of people asked them why they carry a balance. One of the person in the group said he has to have the latest Apple's stuffs because it just ain't cool enough not to have it. Even if it mean you cannot pay for it.
I have no opinion on AAPL right now, but aren't these the clowns that warned of $200 oil when it hit $140? And I remember just about 3-4 months ago some people talking about $8 and I think one guy even said in a few years $20/gal gas!!
What these brokers say needs to be taken with about 100,000 grains of salt IMO.
I think traders/investors are catching on to this bullshit. Look at how DRYS rallied nicely after being downgraded by TWO firms to underperform; MOS rallied nicely after lowering guidance; and POT rallied beautifully since having its target price lowered by about 4 ANALyst firms last week. Oil was recently downgraded to move below $40. That means I should be seriously long at this point, no???
The next two quarters for this economy, especially in the basic material and commodity area are going to be BRUTAL.
OPEC meeting coming up in Algeria, but the Saudis have a tendency to get rid of "cheaters" and their market share by pumping as much as possible in order to teach everyone a "lesson".
Could oil move down under $40?
Sure it could.
That having been said, ANALysts are NOT Traders. They do not have the luxury of being nimble.
And more often than not they are unable to keep up with the volatility of prices in the commodity arena.
downgrade means nothing
The near-term fundamentals are going to create pressure for AAPL longs. I like the stock for the very long-term (i.e. once the economy recovers), but it's a major risk holding for the next 6 months IMO because the chance of an earnings miss is pretty big with the consumer getting hammered.
I would rather wait for either the fundamentals to stop being so bad, or for the price to get so low that it prices in more than the likely worst-case scenario.
December 11, 2008, 1:02 pm
Apple: Another Look At The Wal-Mart Factor
Posted by Eric Savitz
The Street continues to crunch the numbers on what a distribution deal with Wal-Mart (WMT) might mean for Appleâs (AAPL) iPhone sales.
Earlier this week, I took note of Piper Jaffray analyst Gene Munsterâs analysis, which concluded that Wal-Mart could sell as many iPhones next year as Appleâs own retail stores.
This morning, Bernstein Research analyst Toni Sacconaghi runs through the numbers, and comes up with slightly different conclusions.
For starters, Sacconaghi says his checks with Wal-Mart stores show that in fact the reports of a Wal-Mart distribution deal appear to be true; although he is skeptical about rumors the retailer will sell a 4GB model for $99.
Sacconaghi does note, however, that it is possible that phones sold at Wal-Mart could be sold at lower prices than through Apple, AT&T or Best Buy stores. He notes that Wal-Mart had originally planned to sell the T-Mobile G1 - the Google phone - for $148.88, well below the T-Mobile price of $179, but then backed down. On the other hand, he notes that Wal-Mart is selling the Research in Motion BlackBerry Pearl for $18.88 and the BlackBerry Curve for $28.88, both with 2-year AT&T contracts; AT&T itself charges $99.99 for the Pearl and $79.99 for the Curve.
Sacconaghi notes that the blog Boy Genius Report asserted that the phone will be sold in 2,500 Wal-Mart stores and 69 Samâs Club stores. That would bring total U.S. distribution to nearly 6,000 outlets. He says the addition of the Wal-Mart stores will drive iPhone sales, but not proportionately: he says the biggest hurdle for mass adoption is price, not geography.
The Bernstein analyst thinks Wal-Mart can sell between 800,000 and 1.3 million units in FY 2009, or 4%-6% of his projected total. He notes that of the 2.4 million iPhones sold and activated in the U.S. in the September quarter, about 1 million were sold through AT&T stores, or about 500 per store. If you assume Wal-Mart sells then at about 15%-25% of that rate, that would be 300-500 units per store per year. He says some of those sales would likely cannibalize sales from other outlets. Given channel fill of 36-60 units per store, that would add up to 156,000 units to Appleâs results for the December quarter. He notes, though, that there is risk that some iPhone buyers will delay purchases into the March quarter hoping for a discounted price through Wal-Mart.
He also notes that the rumored start date for selling phones at Wal-Mart is December 28, one day after the end of the companyâs fiscal first quarter on December 27.
Finally, Sacconaghi concludes that the partnership with Wal-Mart suggests that Apple wants to drive mass-market adoption of the iPhone, as it has done with the iPod. He thinks the company will ultimately introduce cheaper versions of the phone, but that a 4 GB version at $99 might not be the model; he thinks a low-end phone could compromise on screen size or data speed. An EDGE phone would save significantly on royalty costs, he notes. And he adds that âan iPhone that dos not require signing up for AT&Tâs $30 a month data plan would do the most to stimulate unit sales.â
Sacconaghi maintains an Outperform rating and $135 price target on the stock, asserting that the stock has been âoverly discounted,â that short-term financial will remain relatively healthy despite the economic weakness, and that âthe companyâs longer-term growth story remains intact.â
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