TheStreet.com: Apple poised for a comeback

“Apple finds itself in familiar ground where it has to prove itself,” Priya Ganapati reports for TheStreet.com. “The Cupertino, Calif.- based company has defied expectations in the past and made a comeback like few other technology companies.”

“This time around, investors are disappointed with the company’s conservative guidance for the current quarter and fears that the iPod juggernaut is slowing and may be coming to an end,” Ganapati reports. “A bigger concern is that recessionary fears could curtail consumer spending on Apple products.”

“Two Wall Street firms have slashed their price targets on the stock since the earnings report Tuesday. Goldman Sachs reduced its price target for the stock to $175 from $220, while ThinkEquity lowered its target to $165 from $227,” Ganapati reports. “But with strong sales of Mac computers and new products waiting in the wings, Apple’s growth story may be far from over.”

“The sell-off in Apple’s stock may be overdone as the company continues to offer new products at a higher price point, analysts say,” Ganapati reports. “With Apple shares more than 35% off from their 52-week high last month, the stock may offer a buying opportunity, though investors will have to be patient. ‘It will take new product announcements or the next earnings report to get the stock moving again,’ says Romeo Dator, co-manager of the All American Equity Fund.”

“Apple shipped 2.31 million Macs, posting a 47% revenue growth from the year-before that was mostly in line with analysts’ expectations. In terms of units sold, Macs grew 44% from a year ago,” Ganapati reports. “This year, Apple could see Mac share rise to 3.8% worldwide from an estimated 3.1%, says Mike Abramsky, an analyst with RBC Capital, which makes a market in Apple shares. ‘We estimate each 0.25% share gain equates to $700 million and 11 cents in EPS,’ Abramsky told clients in a research note. ‘The uber-thin Macbook Air may also help Mac share with the added benefit of driving traffic into Apple retail stores.’ Abramsky estimates 50,000 to 100,000 Macbook Airs will be sold this quarter.”

Full article here.

29 Comments

  1. Of course it will bounce back, it’s a been a solid stock for 5 years, and iPhone ‘revolution’ is just starting. RIMM should be worried….
    All categories of Apple products are solid, Mac OS X, Mac Book Pro, Mac Pro , iPod, the new ‘Air’ and of course iPod / iTunes.

    It’s the best line up in Apple’s History, which is say alot….

  2. The revolution is just starting. It shouldn’t scare anyone that a few money-hungry investors got scared and the price dropped a little. The next time Apple throws out one of those media invitations to a “Special Event,” I think we’re gonna see that thing skyrocket again.

  3. Apple doesn’t have to prove a thing to anyone, just execute it’s plan. Imagine if Apple decided that, above all, it wasn’t a software company or a consumer electronics company, but rather an industry UI innovator. That it can study and enter into whatever industry it chooses and toss out the debris and assumed limitations, and redesign with a fresh eye towards simplicity (look out Detroit). This would make it the unstoppable juggernaut, and there’s no one else out there who wants to a) change the world, and b) has the tools, drive, and DNA from the top down to do it. How much would that company be worth?

  4. Actually “the Street” movers and shakers have bought their fill of Apple stock at super low prices and now start the “positive” Apple journalism (yeah right) so the stock price will climb.

    Once it starts back up, they will gloat how they were right and suddenly everyone else will see Apple as super under weight and everyone will try to climb back on the gravy train.

    JMHO. ” width=”19″ height=”19″ alt=”grin” style=”border:0;” />

    en

  5. “Don’t call it a comeback
    I been here for years
    Rockin my peers and puttin suckas in fear
    Makin the tears rain down like a MON-soon
    Listen to the bass go BOOM
    Explosion, overpowerin
    Over the competition, I’m towerin
    Wreckin shop, when I drop these lyrics that’ll make you call the cops
    Don’t you dare stare, you betta move
    Don’t ever compare
    Me to the rest that’ll all get sliced and diced
    Competition’s payin the price”

    -L.L. Cool Jay

  6. The halo effect is working and all the iPod users are buying iMacs and MacBooks. Soon they will be buying AppleTVs.

    Its good how they get continuing revenue on all their sales:
    Macs: Leopard and apps
    iPods: songs
    iTouch: Apps in Feb
    iPhone: ATT revenue
    AppleTV: Rentals

    Even if new sales slow, the revenue keeps coming in.

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