“I read a lot of analyst notes every morning as I prepare for my day, and I have been for years, and every once in a while, you really makes you think,” Cody Willard blogs for MarketWatch. “Such was the case last night as I sat down and read Bernstein’s most recent note on Apple, in which the analysts raise their forward earnings estimates by a buck to over $30 a share because: ‘Despite the fact that iOS’s ecosystem lead may diminish over time, we believe that iPad’s market evolution and competitive positioning is more likely to resemble the iPod than the iPhone, and we have increased conviction that iPad will have sustained dominant market share (50%+) going forward.'”
“3 out of every four MP3 players were iPods at one point. If (and yes, it’s an ‘if,’ unless you’re a permabear or luddite, it’s not a ‘BIG if,’ but just an ‘if’) tablet sales go from 20 million in 2010 to 100 million 2012 to 250 million in 2015, we’re talking about Apple selling more than 200 million tablets in five years from this year,” Willard writes. “And we’re talking about a business line that will see gross margins expand as volumes and expertise grow. And more importantly we’re talking about a total of a billion iPads being in circulation, using the iOS ecosystem with all its huge margin revenue generators like apps, subscriptions, music, video, and so on…think about trying to model what Apple’s earnings will be in 2015 with that kind of bottom line leverage in the pike.”
Read more in the full article here.
[Thanks to MacDailyNews Reader “Fred Mertz” for the heads up.]