24/7 Wall St.‘s Douglas A. McIntyre: No way, no how Apple hits $205 within 12-months

“Piper Jaffray has raised its price target for Apple (AAPL) from $160 to $205. up 28% which is stunning. Apple trades at $143 now. So, a stock that is up 130% over the last year would rise another 43% from the current price,” Douglas A. McIntyre opines for 24/7 Wall St.

“The new target price is based to a large extent on an estimate by the firm that Apple will sell 45 million iPhones in calendar year 2009, at an average price of $330,” McIntyre writes.

McIntyre describes Piper Jaffray’s forecast as “nutty,” writing, “The idea that Apple will sell a third as many phones at Motorola sells now is not credible… The Apple estimate also assumes that the larger handset companies will not come out with competing phones.”

Of Piper’s 12-month price target of $205 for Apple, McIntyre writes, “No way, no how.”

Full article here.
24/7 Wall St.’s website states, “The editors of 24/7 Wall St. do not own securities in companies that they write about. Other writers may have positions in companies and these are disclosed in their articles.” Since no such disclosure is contained within McIntyre’s article, we assume McIntyre has no stake in AAPL.

We believe that McIntyre is underestimating the excellence of iPhone, the power of word-of-mouth, and Apple’s ability to expand their iPhone product line at various price points (as they did with iPod), while overestimating competitors’ abilities to copy a device with over 200 patent applications that Apple has stated they plan to vigorously defend. McIntyre also seems to be totally discounting Mac growth, future iPods, and possible unreleased, unknown products from Apple.

We have iCal’ed McIntyre’s article, which we will revisit in 12-months or if AAPL shares hit $205 before a year elapses.

53 Comments

  1. Eric24601…

    You’ve fallen into the classic trap of believing something on a website, particularly NASDAQ’s website.

    Sadly – as with their reporting on Vodafone (which is apparently worth more money than you can shake a stick at) – NASDAQ have a small problem which is that they haven’t taken into account Google’s Class B stock.

    By Google’s own calculations, they are worth $162.05 billion which means that Apple has still got to put on around $60.

  2. Other companies making similiar phones???? How come they will come to their senses at this late stage in the game.???

    “No, the iPhone doesn’t make you taller, stronger, better looking, or able to fly. It’s not the perfect device for every human being on the planet, nor is it perfect for every situation. In fact, it’s not perfect at all.

    However, it is the best phone I’ve used, or even played with, and with the sole exception of Exchange/Domino-style connectivity, it is the best smartphone I’ve ever used. I’ve been using it heavily since it came out, and it’s done everything it’s supposed to do better than anything else I can think of. It’s not the cheapest smartphone I’ve ever had, but it is, by far, the best value in a smartphone I’ve ever had, and I’ll take value over low price any day.

    Well worth every penny”

    Apple, moving into the next generation — ahead of everyone else. Cause they still don’t get it. ” width=”19″ height=”19″ alt=”grin” style=”border:0;” />

  3. NOK is worth a hundred and fifteen billion dollars. MOT is worth forty-one billion dollars.

    The iPhone can add a hundred and sixty-six billion dollars to Apple’s market capitalization, even if growth in the cell phone market stopped, which isn’t going to happen.

    AAPL at $205? Hell yes. McIntire is going to eat his words, just like Goldman did.

    -jcr

  4. NOK is worth a hundred and fifteen billion dollars. MOT is worth forty-one billion dollars.

    The iPhone can add a hundred and sixty-six billion dollars to Apple’s market capitalization, even if growth in the cell phone market stopped, which isn’t going to happen.

    AAPL at $205? Hell yes. McIntire is going to eat his words, just like Goldman did.

    -jcr

  5. NOK is worth a hundred and fifteen billion dollars. MOT is worth forty-one billion dollars.

    The iPhone can add a hundred and sixty-six billion dollars to Apple’s market capitalization, even if growth in the cell phone market stopped, which isn’t going to happen.

    AAPL at $205? Hell yes. McIntire is going to eat his words, just like Goldman did.

    -jcr

  6. NOK is worth a hundred and fifteen billion dollars. MOT is worth forty-one billion dollars.

    The iPhone can add a hundred and sixty-six billion dollars to Apple’s market capitalization, even if growth in the cell phone market stopped, which isn’t going to happen.

    AAPL at $205? Hell yes. McIntire is going to eat his words, just like Goldman did.

    -jcr

  7. I wish I could understand why analysts need to make all sorts of predictions (good or not so good) so far ahead into the future, when quarterly reports are around the corner…

    I have grown rather suspect of the motive behind such predictions, especially when they come from people that mange other people’s money.

  8. Although the market value of a company is meaningful, it is not easy to compare the real impact of companies by comparing their market values. For whatever its worth, here are some interesting numbers (according to NASDAQ):

    Apple’s market value:
    $124,336,275,000

    Dell:
    $66,285,696,520 (53% of Apple’s market value)

    HP:
    $127,120,872,060 (102% of Apple’s market value)

    IBM:
    $170,472,987,870 (137% of Apple’s market value)

    Lenovo:
    $103,648,527,450 (102% of Apple’s market value)

    Sony:
    $51,347,716,860 (41% of Apple’s market value)

    Toshiba:
    $29,936,951,100 (24% of Apple’s market value)

    Gateway:
    $601,763,580 (0.5% of Apple’s market value)

    Intel:
    $142,635,500,000 (115% of Apple’s market value)

    Microsoft:
    $298,101,737,280 (240% of Apple’s market value)

    AT&T
    $1,129,300,000 (0.9% of Apple’s market value)

    Verizon:
    $122,754,229,920 (98.7% of Apple’s market value)

    Motorola:
    $41,547,411,050 (33% of Apple’s market value)

  9. Ok, here is my humble opinion and analysis. First some things to remember. Stock splits mean nothing. A $100 stock that splits is worth $50 but now you have 2 shares. You neither made nor lost money. The host of “iPhone killers” won’t live up because the iPhone runs Mac OSX and integrates with iTunes …match that! RIM and Palm have their place but its clearly a different experience. In my opinion, the iPhone is the smartphone for the masses. Even though other companies “won’t sit still”, neither will Apple. In fact, there are already rumors of an iPhone nano. The bloodbath has surely begun.

    The stock price: The annual consensus estimate is $3.56. If they beat estimates by $0.50 for the year (.2 this quarter and .3 next) then that would make their annual $4.06. At a PE (multiple) of 37 which is where it had been trading at until recently that would mean a stock price of $150 at the end of the 4th quarter. If it continues to command a higher multiple (currently at 42) then the price should hit 170 or 171. 4.06 x 42 = 170.52. That’s where I think it will be at the end of October. Keep an eye out on earnings on July 25th and by how much they beat estimates. Expect the price to possibly go down as people take profits and use it as a buying opportunity. So where will it be next July? 200 seems very reasonable if they beat earnings by 0.50 this year and match estimates next year for the first 2 quarters.
    Stocks are my hobby and I’m not an expert so don’t flame me if you disagree.

  10. Hey Guys Me, Still bored , no Girl
    Bu hey Mac selling well, Apple will keep going,

    MS will become irrelavant
    also: few facts: These are a bit scary:

    I think Sony are the ones who started to stop plasma screens from selling well , saying they have issues with burn out etc

    Also: Google is not that big they are just a search engine its all they do, Apple is 50,000 times there size in real world stuff.

  11. Hey Guys Me, Still bored , no Girl
    Bu hey Mac selling well, Apple will keep going,

    MS will become irrelavant
    also: few facts: These are a bit scary:

    I think Sony are the ones who started to stop plasma screens from selling well , saying they have issues with burn out etc

    Also: Google is not that big they are just a search engine its all they do, Apple is 50,000 times there size in real world stuff.

  12. Hey Guys Me, Still bored , no Girl
    Bu hey Mac selling well, Apple will keep going,

    MS will become irrelavant
    also: few facts: These are a bit scary:

    I think Sony are the ones who started to stop plasma screens from selling well , saying they have issues with burn out etc

    Also: Google is not that big they are just a search engine its all they do, Apple is 50,000 times there size in real world stuff.

  13. Hey Guys Me, Still bored , no Girl
    Bu hey Mac selling well, Apple will keep going,

    MS will become irrelavant
    also: few facts: These are a bit scary:

    I think Sony are the ones who started to stop plasma screens from selling well , saying they have issues with burn out etc

    Also: Google is not that big they are just a search engine its all they do, Apple is 50,000 times there size in real world stuff.

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