Michael Johnston
April 29th, 2007, 04:03 PM
<strong><a href="http://www.appleinsider.com/articles/07/04/26/cingulars_smartphone_sales_dip_ahead_of_iphone.htm l">AppleInsider reports</a> that Cingular stores are experiencing a slowdown in smartphone sales and is partially attributing this to the iPhone launch expected sometime in June.</strong>
This information comes in via well-known Apple fanboy at investment research firm PiperJaffray, Gene Munster. According to Munster, this slowdown is due to pent-up demand for the iPhone. He believes that Apple will benefit from a continuing growth in demand as the months go on.
From <a href="http://www.appleinsider.com/articles/07/04/26/cingulars_smartphone_sales_dip_ahead_of_iphone.htm l">AppleInsider</a>:
<blockquote>Munster's checks reveal a robust market for high-end handsets in the above-$300 range. For instance, he said Nokia's N95 model is selling extremely well in Europe for €450 (over $600 US), where Apple remains on track to launch iPhone later this year.
"Therefore, our checks suggest that demand for the iPhone will be high at launch and will continue to grow as Apple expands the product into international markets,"
[...]
Thus far, Munster says his team of analysts have not run across any credible competitive threats to Apple's core markets. For instance, Microsoft's Zune, which was conceived to steal share from the iPod, "is a flop." Similar, Dell and HP have failed to deliver PCs that rival the Mac," he said.
PiperJaffray remains confident that over the next several quarters Apple will hold its massive lead in portable audio and grow share in the personal computer market.
"We believe Apple's performance is sustainable for 3 reasons," Munster wrote. "1) we expect gross margin to stabilize above 30 percent in [the second half of the year] due to favorable component pricing and level product pricing; 2) Apple is entering three of its strongest product cycles ever with the iPhone, Apple TV and Leopard; 3) Apple continues to innovate and we do not expect the pace of innovation to slow."
</blockquote>
PiperJaffray believes this is enough to raise Apple's target price from $123 to $140. Of course, this should not be taken without a grain of salt as Gene Munster tends to always have a bullish outlook on Apple. That having been said, the outlook on growth for Apple due to the iPhone looks good.
This information comes in via well-known Apple fanboy at investment research firm PiperJaffray, Gene Munster. According to Munster, this slowdown is due to pent-up demand for the iPhone. He believes that Apple will benefit from a continuing growth in demand as the months go on.
From <a href="http://www.appleinsider.com/articles/07/04/26/cingulars_smartphone_sales_dip_ahead_of_iphone.htm l">AppleInsider</a>:
<blockquote>Munster's checks reveal a robust market for high-end handsets in the above-$300 range. For instance, he said Nokia's N95 model is selling extremely well in Europe for €450 (over $600 US), where Apple remains on track to launch iPhone later this year.
"Therefore, our checks suggest that demand for the iPhone will be high at launch and will continue to grow as Apple expands the product into international markets,"
[...]
Thus far, Munster says his team of analysts have not run across any credible competitive threats to Apple's core markets. For instance, Microsoft's Zune, which was conceived to steal share from the iPod, "is a flop." Similar, Dell and HP have failed to deliver PCs that rival the Mac," he said.
PiperJaffray remains confident that over the next several quarters Apple will hold its massive lead in portable audio and grow share in the personal computer market.
"We believe Apple's performance is sustainable for 3 reasons," Munster wrote. "1) we expect gross margin to stabilize above 30 percent in [the second half of the year] due to favorable component pricing and level product pricing; 2) Apple is entering three of its strongest product cycles ever with the iPhone, Apple TV and Leopard; 3) Apple continues to innovate and we do not expect the pace of innovation to slow."
</blockquote>
PiperJaffray believes this is enough to raise Apple's target price from $123 to $140. Of course, this should not be taken without a grain of salt as Gene Munster tends to always have a bullish outlook on Apple. That having been said, the outlook on growth for Apple due to the iPhone looks good.