Needham ups Apple target to $115, forecasts Macs capturing 8.3% worldwide market share by 2016

“Needham & Co.’s Charles Wolf has joined the ranks of several other Wall Street analysts who recently boosted their outlook on Apple Computer, raising his 12-month price target on the company’s shares to $115,” Katie Marsal reports for AppleInsider.

“Wolf said his new price target of $115 is based on a ‘more realistic reading of the switch rates among Windows users’ that should ensue from the Mac’s ability to run Windows applications through Boot Camp under the upcoming Leopard operating system,” Marsal reports.

Marsal reports, “Under the analyst’s revised valuation model, he employs the actual mean switch rates of Windows users rather than the increase in the mean switch rates. He assumed that the only Windows users who switched were those in the U.S. and European home markets — which represent about 20 percent of the worldwide PC market. ‘Our forecast has Apple’s share of these two markets increasing dramatically — from 9 percent in 2006 to over 40 percent in 2016,’ he told clients. ‘A significant portion of the increase results from our plausible assumption that once they switch, a high percentage of Windows users will stay with the Mac platform when they subsequently upgrade.'”

Marsal reports, “Still, Wolf noted that only a third of Mac sales are generated in the U.S. and European home markets, adding that it’s likely the Windows-on-Mac effect will invade other segments of the worldwide market, most notably education and the small and medium business markets. ‘A more accurate measure, then, of the iPod halo and Windows-on-Mac phenomena is Apple’s share of the worldwide PC market,’ he wrote. ‘This increases more realistically from 3.5 percent in 2007 to 8.3 percent in 2016, the last year in our forecast.'”

Full article here.

MacDailyNews Take: Wolf’s forecast of Apple increasing share of the U.S. and European home markets from 9 percent in 2006 to over 40 percent in 2016 should be of serious interest to software developers. Of course, trying to accurately project anything out to 2016, including Wolf’s 8.3% worldwide share figure for Macs, is quite impossible.

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Apple’s Mac market share surges, up 35-percent year-over-year as growth accelerates – November 01, 2006
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Gartner: Apple Mac grabbed 4.6% U.S. market share in Q2 06 – July 19, 2006
IDC: Apple Mac attained 4.8% U.S. market share in Q2 06 – July 19, 2006

24 Comments

  1. Market share will rise way more than this guy says. Word will spread fast once people realize that MACs are far better, more reliable and are designed from the ground up with something Dell and other box makers can’t find.

    CLASS, STYLE and SOPHISTICATION.

  2. MacFreak, you are CORRECT!

    One of my friends, (bandmate actually), wjho has ALWAYS scoffed, without having any idea what he’s talking about, just last night said “I’m gonna do that”; in response to me suggesting “get a Mac”, as he won’t download anything from limewire.

    That is just one of many examples like that.
    Actually, come to think of it, I did convert another bandmate,can think of 7 or 8 others I directly had an effect on the conversion.

    Anyone else?
    How many would you say you’ve converted. Just the #.

  3. Actually, don’t be so hard on Charles Wolf. His point is that the long term outlook for Apple is very good. Yeah, no one can predict the future, but he’s trying to get an idea of future trends.

    By the way, he’s talking 8.3% worldwide marketshare. That may seem like puny numbers at first glance, but it’s not. 8.3% of the worldwide market today would mean more than 25 million Macs sold per year. That’s more than 5 times the number of Macs Apple wold in all of fiscal 2006.

    If Apple is selling 25+ million Macs a year, it’ll be probably doing close to $60 or $70 billion a year in sales, maybe even $100+ billion given that there will be iPod, iPhone, and other revenues on top of the Mac stuff. That’s a giant of a company, and it’ll be in the ranks of companies like GM and Boeing in terms of size. Don’t knock “8.3% worldwide marketshare” out of ignorance.

    The key for Apple is to manage that growth without falling into the Microsoft trap of hiring 10,000 middle managers whose only purpose for existence is the meddle with the works of geniuses.

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