Credit Suisse: Apple Mac will continue to outgrow overall market for many years to come

“Apple is the seventh-largest personal-computer vendor in the world, but is widely regarded as one of the most innovative technology companies in the world. Key factors are enabling Mac momentum to defy macro conditions. We believe Mac performance is due to several unique drivers that were not present in prior downturns. We anticipate that Apple will continue to grow at a multiple of the overall market for many years to come,” Credit Suisse explains as they initiated coverage of Apple Inc. (AAPL) with an “Outperform” rating and a 12-month target price of $200, as reported by Barron’s.

“First, Apple has successfully reduced the perceived and actual switching costs for Windows users looking to adopt the Mac platform. Second, Apple’s support of the Intel architecture has leveled the playing field in terms of speeds and feeds comparisons between Macs and PCs. Finally, Apple’s successful retail strategy has broadened the availability of Mac products and given Apple more control over the critical computer-selling process. Users can now explore the advantages of the Mac platform with highly trained Apple sales reps,” Credit Suisse writes.

“iPhone economics have changed for the better. After considering the economic costs of iPhone unlocking, we find that the new business model is likely to be far more profitable for Apple over the long term,” Credit Suisse writes.

“We believe Apple’s valuation is set to expand and we would be buyers of the stock. Our 12-month target price of $200 equates to a price to earnings multiple of 30 times our calendar 2009 earnings per share estimate of $6.66, which is about in line with the stock’s one-year average, but still below historical levels,” Credit Suisse writes.

More in the full article here.

[Thanks to MacDailyNews Reader “Chuckles the Microsoft CEO” for the heads up.]

31 Comments

  1. Perhaps they don’t think the server / corporate growth will be significant since it wasn’t even addressed…. I do, and think that Snow leopard is focused on enterprise adoption which will add to the growth.

  2. While I both hope and expect this to be true, I think it’s a bit of wishful thinking to predict it will be true. It’s going to be harder for Apple to grow their Mac business as their niche of the market grows. Of course, they have a long way to go before this starts to be a noticeable problem, but I expect they will get there. Soon.
    Sooner, if they’d finally introduce the Mac midi I’ve been hoping for for several years now – a shorter, less feature-rich, tower priced more like an iMac than the Mac Pro it looks like the bottom half of.

  3. It seems many big firms are catching on to Apple. Seeing how the oil and resource bubbles are over, a lot of analysts are looking to see where they can make a buck. You think it’s a coincidence these reports are coming now? Apple could well become a favorite among big investment houses. This is good news as it would add stability and make aapl less susceptible to hedge funds and others trying to make a quick buck.
    On another note, see the following link for a good laugh: http://www.electronista.com/articles/08/08/07/bberry.kickstart.now.pearl/
    It’s marketing lingo extreme. primary customers are young urbanites, multi-tasking women (!) and mobile men (wtf!)
    Check it out!

  4. With the latest unfixable security flaw in Vista the Mac will quickly spread into government and big business. And ZFS life system in Snow Leopard is the clincher.

  5. “Seeing how the oil and resource bubbles are over…”

    LOL! Over? They haven’t begun yet. More than half of Americans are buying the BS that drilling might offer even a temporary solution. That means that the worst possible signal is being sent to OPEC: Americans are not serious about getting off of oil. As, or if, we produce more, they’ll cut production. Prices will continue to do what they’ve been doing: creep up slowly, then spike, only to drop a little when we scream from the pain. When will that merry go round stop? When some of the OPEC nations find they’re unable to maintain production levels. Then things will get really bad. You ain’t seen nothing yet.

  6. Interesting. UBS and now Credit Suisse are on board with Apple this week and up goes the stock price. Is that what it took? Apple’s business model has been unassailable since way before these foreigners (and Monkey-boy in Seattle a few weeks ago) took note of it.

    Apple was at $200 a share at the end of ’07 and they’re nowhere near that right now. Nothing has changed except now the “big boys” have suddenly noticed an innovative, Silicon Valley global brand that will be kicking ass and taking names for the foreseeable future?

    The stock market disgusts me sometimes.

    Peace.
    Olmecmystic ” width=”19″ height=”19″ alt=”cool smile” style=”border:0;” />

  7. Wow! “LOL! Over? They haven’t begun yet. More than half of Americans are buying the BS that drilling might offer even a temporary solution. That means that the worst possible signal is being sent to OPEC: Americans are not serious about getting off of oil. “

    Only problem with your theory. We have enough oil reserves to be in the top 3 world oil production countries. Unless Saudi Arabia, Russia, and Iran were to turn off their spigots entirely, then good luck at them reducing their supply to spike up oil if we drilled into the resources we already know that we have.

    Even if there was a viable replacement for oil, it would take a long time for it to become widely distributed and used.

    Drilling is a viable solution for at least a few decades, if we were to do it seriously.

  8. twilightmoon,
    Stop watching Fox. You’ll go blind. Worse, you’ll believe what you’ve just written. If we had enough oil reserves we wouldn’t have had a problem in 1973, let alone now. We had to beg Saudi Arabia to increase production by half a million barrels per day because that big a jump for us is out of the question. Even if we could do it, they’d be happy to drop theirs by a million per day. It would not only keep prices high, but it would delay the day when their reserves become difficult to access.

    Then there’s the problem of the profit motive. Oil companies have no incentive to drill more oil if it’s going to reduce prices. That’s why they haven’t touched most of the leases they have. They’ll hold them in reserve until THEY need them, not us.

Reader Feedback

This site uses Akismet to reduce spam. Learn how your comment data is processed.