BTIG analyst: Why I upgraded Apple today

“Wall Street has become increasingly bearish on Apple this year, a view represented by a beleaguered stock price and downgrades, but on Thursday, one firm bucked the pessimistic trend and upgraded the name to ‘buy,’ with a $540 price target,” Paul Toscano reports for CNBC.

“Walter Piecyk, the analyst at BTIG responsible for the upgrade, spoke with CNBC’s ‘Squawk on the Street’ to discuss his view on why the stock has upside in the medium term. ‘The buy side wants to look towards 2014 where there could be earnings growth,’ he said,” Toscano reports. “‘The Street went from basically thinking that (CEO) Tim Cook has to provide some revolutionary product to now assuming that he won’t even do obvious things to generate revenue,’ Piecyk said. ‘There’s clearly a revenue opportunity with a low-priced phone. I think it’s logical that they will or they’ll find other revenue opportunities in 2014. Frankly, if they don’t, you’re probably looking at another management team.'”

Toscano reports, “‘The market opportunity for Apple — that they don’t address right now — is the 70 percent of the global subscriber base that is pre-paid. They want an iPhone,’ he said, citing mobile phone re-seller Gazelle, which that said there is an ‘insatiable’ demand for cheaper iPhones in emerging markets. ‘If Apple can address that market, that is incremental revenue and profit opportunity,’ he added.”

Read more, and see the video, in the full article here.

Related article:
Bear no more: BTIG upgrades Apple to ‘buy,’ with $540 price target – March 14, 2013


    1. Market profit? Market profit on 100 customers, 1000 customers 1 million customers 10 million customers? Margins are important. Market profit, as you call it, is important. But don’t assume that market share doesn’t matter. Because it does. Ideally you would like to own both areas. Market profit is great unless your market share is decreasing. Then market share matters. If marketshare doesn’t matter then Apple won’t be rolling out a larger iPhone and a more affordable iPhone for the emerging markets. And you know they are going to do just that. And that will prove that Apple needs marketshare. I see so many people here hide behind the comment that “Apple makes all the profit and who cares about the part of the market that they don’t control”? Well, apparently Apple cares. If Apple were the same size as it was seven or eight years ago marketshare wouldn’t matter as much. But Apple is huge now. And in order to grow or even stay as they are, they need to grow their market share as well as their margins. And with an increase in market share margins can come down some.

      1. At least you’re consistent: “And you know they are going to do just that. And that will prove that Apple needs marketshare.”

        I forget what that’s called, in terms of varieties of arguments (there’s a wikipedia article on the varieties) but it is bassackwards. I wish you could go work at Apple for a few years to see how that is not what drives product innovation at Apple. When Steve introduced the iPhone he humbly said they were hoping to capture 1% of the market. They were not entering a new market space to grab 100% or 75% or 12% market share. They were trying to fix a broken mobile communications problem. If they did that successfully, then market share & profits would take care of themselves. I have no doubt that teams within Apple are looking at ways to cost reduce the iPhone, and they do succeed, we’ll know not that Apple “needs” market share but that Apple has invested time and money creating a better iPhone that will bring Apple goodness to millions more customers.

        1. Well aren’t you the bright one now? You’re not even smart enough to find something on Wikipedia? Nice going genius. And please, don’t act like you work at Apple. At least I have a very close friend who does working at Apple. Now. That has a little more relevance then you putting your spin on what Apple does. Yes, we all understand Steve Jobs outlook and philosophy. What you don’t understand is what he didn’t talk about. And as my friend has told me more than once, it’s about making money. Something that if you work at Apple, you would understand. And I find your haughty arrogant look down your nose attitude amusing. In other words suck my cock.

      2. GM, Apple has over 70% of the “Worldwide” smart phone profits. The rest is going to Samsung and everyone else, actually just to Samsung because everyone else is losing money. Their unit market share is slowly climbing also, and “Android” market share may not be what it appears to be.
        Real Android, that is Android that spoons profit to Google may be below 14% of the market. China has a version of Android that is China only(even have a $10 phone too), and is as big as Googles Android, and cuts out Google. Kindle has an “Android” that only goes to Amazon, so not Google Android. Samsung is also developing a version of Android, which will cut out Google and steer customers to Samsung services. For some reason analists seem to be counting all versions as equal however for some reason.
        Also Apple Maps (which are improving every day by the way, now that all that mapping information provided by Iphone users is going to Apple instead of Google) is another loss for Google beyond just the use fees Apple was paying them.
        So I see trouble for Google, everyone else, but why is everyone worried about Apple?

        1. Very good points. But as I stated, you still have to fight for market share. Because high margins on a decreasing market share means less revenue thus less profits. Would you rather make high margins on 100 customers or high margins on 1 million customers? The margin percentage might be the same but the revenue would obviously be more on 1 million customers. Unless you want to keep the company small. If that’s the case you don’t need to worry about market share as much. But it’s too late for Apple to stay small. Apple is the biggest company out there. It’s something that people here just don’t understand. You can’t put the genie back in the bottle. Apple is huge. Unfortunately, there are problems when you succeed and your business size grows. Apple is faced with that problem now.

  1. The Manipulator: Why should I downgrade Apple tomorrow?
    a. Some fag guy called Jim wants to suck my cock.
    b. Some fag guy called GM wants me to suck his cock.
    c. My wife won’t suck my cock.
    d. I love it when Apple goes down on me.

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