October 14, 2010 by USA Post
Verizon Ipad, (AP) – Stock of Apple Inc. flirted with and 300 on Tuesday as investors high and the promise of IPAD pushed from a record high. Analysts see few reasons to believe that part will stop here.
As was the case with the iPhone, Apple iPhone is setting standards for this generation of tablet PCs as competitors scramble to match the design and functions.
So far no credible challengers have flooded the market. Microsoft Corp., Steve Ballmer promised Windows-based tablets, but so far there is no solid details. Meanwhile, tablet-based Google Inc. Android starting to emerge, but they have smaller screens than the IPAD.
In the first quarter it was available, Apple has sold 3.3 million iPads. It is about three times the number of iPhones sold in the first full quarter of smart phones were sold in 2007.
Rajesh Ghai, ananlyst at ThinkEquity LLC, said he believes Apple has sold 5.7 million iPads in the latest quarter, which ended in September. He said that adds about $ 3 billion and revenue – not bad for a product category that did not exist before April. Analysts’ estimates for unit sales in 2011 iPad are changing, with those of the late conservative put the number around 20 million, while the most optimistic forecasters say it could be 50 million.
“Obviously IPAD has proved a success beyond the wildest dreams of Apple,” Ghai said in an interview.
A few other factors are enhancing investors’ enthusiasm for Apple, which reports quarterly results on Monday. The Cupertino, Calif.-based Company is planning a big push in China, with 25 retail stores expected to open there at the end of next year.
There is also the new list of iPods, which Apple unveiled in September, in time for the cost of gadgets making their way on gift lists.
And investors may choose to believe stronger buzz that Verizon Wireless will get its own version of the iPhone in 2011. In the U.S., the iPhone is only available on AT & T Inc. network, which puts a strain on some cities in the high volume of data consumed by users of iPhone. Addition of carrier partners could attract U.S. buyer’s smartphone that were reluctant to move to already taxed & T.
Shares of Apple traded as high as 299.50 and Tuesday before ending the day at 298.54 and a gain of $ 3.18.
Apple’s share has increased dramatically and fairly steadily since the end of the dot-com bust, and about 7 per share in early 2003 and nearly $ 169 in summer 2008. The share price dropped below 100 per share and in late 2008 and early 2009, investors are concerned about the health of CEO Steve Jobs, but he has taken since March 2009. Actions together all records high on a split-adjusted basis on several occasions this year.
Compare that with another player well-known technology, IBM Corp., which experienced a rise much more agitated before reaching a record of all time and Monday to 139.66, breaking the previous record set in 1999.
Apple and IBM are pioneering at the same time, but they are not signs of a surge in the broader technology industry, “said Nehal Chokshi, ananlyst at Technology Research Insights Research Group-Southridge. These events are specific to the company.
“IBM did not explode in the bubble, and Apple has grown really phenomenal,” said theanlyst.
To be sure, there are some dark grains that marred the prospects for investment also very favorable. For one thing, Apple insists on sitting on more than 24 billion in cash, more than could reasonably be used for acquisitions, saidanlyst Colin Gillis BGC Partners. Some of that money should go to shareholders, theanlyst said.
A $ 300 per share price tag may seem expensive in absolute terms, but Gillis and otheranlysts say it is a reasonable number for a company growing as quickly as Apple. (Gillis has a price target of 350 for the stock.) In the period April to June, net profit of the company jumped 78 percent from the previous year to 3.25 billion and revenue increased 61 percent to 15.7 billion.
Apple is to present the results of its fourth fiscal quarter on Monday. The company is forecast for a net profit of 3.44 per share, but the company is known for beating its own guidance by a handy margin. Analysts forecast a net profit of 4.05 per share. This would represent growth of about 46 percent.
The concern, of course, is Apple’s growth will eventually slow down.
“You can have a strong growth if you are not the greatest player. If you are the main actor, it is difficult for you to grow much faster than the market,” said Nehal Chokshi, ananlyst Search Technology Research Insights Southridge Group. “Apple has become one of the greatest players.”
And not only the tallest player among consumer electronics companies: In May, Apple has jumped from Microsoft to take the No. 2 spot on Standard and Poor’s 500 market index used by most managers Professional fund. Now the company is on track to surpass Exxon Mobil Corp. as the largest company by market capitalization.
Chokshi said he sees the iPhone Android difficult, even among customers AT & T. In this spirit, theanlyst feels more conservative on the stock of his peers. His price target: $ 315.
“I’m getting a little worried that the stock may be getting ahead of himself,” Chokshi said. “Android is gaining share of mind. Not much, but a few.”
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