“Seriously. I get the appeal of a high-end watch with a real Swiss movement. It’s classy and old-fashioned…and it’s something a man can pass on to his son or grandson one day. There is something infinitely appealing about that. But a digital watch that beeps with incoming text messages kinda lacks that timeless appeal,” Sizemore writes. “Consider the average iPhone buyer: They are the average American. Most buy a highly-subsidized phone in exchange for a long-term contract with their carrier. Is it really realistic to assume that one out of a hundred of them will spend thousands of dollars on a gold watch? I have higher hopes for the sport edition of the Apple Watch, which is expected to retail for about $350. But even here, is it realistic to expect sales of 2 million to 3 million per quarter? That would imply that 2% – 3% of all iPhone owners buy an Apple Watch every year. That’s probably doable. But it would also only add about $3 billion to Apple’s revenues in a given year. That’s nice, but hardly a game changer.”
“Here is the beauty of it: The Apple Watch doesn’t matter. If the Apple Watch is a total flop — and I believe there is a decent chance that it will be — it will be a minor bump in the road for Apple,” Sizemore writes. “Is there a trade here? Maybe. If Apple Watch sales come in lower than expected, Wall Street might dump AAPL stock in a short-sighted temper tantrum. Should that happen, use it as a buying opportunity. Apple is a dividend-raising, share repurchasing powerhouse with a bullet-proof balance sheet.””
Read more in the full article here.
MacDailyNews Take: iCal’ed.
[Thanks to MacDailyNews Reader “Bill” for the heads up.]