How Apple’s market share will propel stock price to $500

Apple Online Store Apple is “in the best position to take advantage of the mobile Web. Still in its infancy, Apple already dominates the 3G wireless spectrum. AT&T’s brand has suffered because of the stress this one product puts on its entire system. My favorite piece of anecdotal data was the Google report from February that said Apple’s iPhone produced 50 times more search requests than any other mobile handset,” Jason Schwarz writes for SeekingAlpha. “Google initially thought they had made a mistake in tabulating their data so they made their engineers check the logs again and found that yes, iPhone use was surging. Since February, the trend has continued. In its September mobile metrics report, AdMob discovered that the iPhone OS increased its global market share up 7% to 40% while Nokia dropped 9% down to 34%. Mobile Web browsing will continue to grow and grow.”

“in the future, Apple will excel as they build innovative products to take advantage of mobile apps. Because of the closed software/hardware Apple ecosystem, this company is better positioned for growth than any company in the history of technology. 100,000 apps available through the App Store makes it difficult for competitors to outdo the iPhone,” Schwarz writes. “Tech has become so complex that consumers now demand a user experience that is intuitively simple. Google’s Android will try to emulate the Microsoft ‘open’ success of the past but that clearly was a different era. We no longer tolerate the bugs that come from mixing software with multiple hardware manufacturers. The mobile era is all about convenience and Apple delivers.”

Schwarz writes, “Apple sold 78% more iPhones in FY09 over FY08. iPhone units are tracking a similar path as the early years of the iPod. Could the iPhone one day grow to 70% of the smart phone market? If they did then we would need to raise our price target to $5000 instead of $500. The point is, there is much upside to the current 2.5% global market share [of all handsets; Apple grabbed 18% share of the worldwide smartphone market in Q309] and this will be a primary stock driver for the next two years. You might want to be in on this one. The Apple Revolution is coming.”

Full article, from someone who gets it, here.

[Thanks to MacDailyNews Reader “GetMeOnTop” for the heads up.]


  1. The great thing about all of the iPhone runner up’s is that every time somebody writes about them – they also bring up the iPhone. Nonstop.

    Here’s Google news – on the day Droid shipped. Mentions iPhone 10 times.

    Article talking about Droid Tethering. Mentions iPhone 29 times.

    Walt Mossberg reviewing Droid. Mentions iPhone 11 times.

    Free pub.

  2. You got to be kidding me raising their price target for CRAPple to $5000 if they control 70% of the marketshare of smartphones. LOL…… Look it has been over 3 years now and how CRAPple’s little phone haven’t change since the first generation and how quickly I find their phone out of style same goes with all of their toys. When it comes to decisions that matter, Bing & Decide

  3. Just a reality check for the math-impaired:

    At $500/share, Apple’s market cap would be $450 billion. At $5,000/share, they would be $4.5 trillion. I don’t think 70% of the smartphone market is worth $640 for every man, woman, and child on the planet.

    In 2008, 139 million smartphones were sold (according to Gartners) and had increased 13.9% YOY. At $5,000/share, if Apple had sold to 100% of those users, the company would be valued at $32K per smartphone sold.

    To be fair, maybe the author was employing hyperbole to make a point, but it’s still sloppy.

  4. @I’m a PC
    “…little phone haven’t change since the first generation and how quickly I find their phone out of style same goes with all of their toys.”

    Then why is the Zune HD so much alike the unfashionable iPhone/iPod Touch? If you want to criticize Apple, at least come up with something with bit more substance. Your post is not even entertaining or inflammatory, so you missed your mark.

  5. “Because of the closed software/hardware Apple ecosystem, this company is better positioned for growth than any company in the history of technology.”

    Wonder if MDN iCaled of statements by Gates, Dell, Dvorak, or Enderle re Apple’s vertically integrated mistake. The stock line for decades was the advantage of windows+OEM.

  6. Remember in a few years the “smartphone market” will be the entire mobile phone market.

    A few years after that the so-called “smartphone” will be the PC of the developing world.

    What’s 70% of 5 billion units worth? Add in 30% of App sales? Add in video & music downloads, print media subscriptions, etc?

  7. It is not about the mobile web but the mobile Internet. It is about being a part of the cloud, wherever, whenever and however you want. The iPhone has 100,000 apps that show how a mobile Internet brings new meaning to a smartphone. Safari and web browsing are a small fraction of the revolution the iPhone has wrought…

  8. disposableidentity thinks the definition of “smartphone” will remain static as the market shifts under it. I don’t agree. I believe the definition will shift upwards as the various phones within it boost their capabilities. There will always be a market for a low-end model as well as a top-end model, and the feature set will vary according to the price. Of course, the “basic features” offered in each will vary. That’s what you are paying extra for! How soon will Apple introduce “miniLife” and “miniWork” to their iPhones? Maybe “Cloud” apps, maybe local. Upping the definition of “smart”!

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