“In a report published Wednesday, Piper Jaffray analyst Gene Munster maintained an Overweight rating and price target of $172 on Apple Inc.,” Jim Swanson reports for Benzinga. “The analyst mentioned that investors might be waiting to see the impact Apple has on the shift of carriers to a monthly installment model of phone pricing, which means that prices would not be subsidized.”
“‘The plans sell the benefit of enabling customers to pay no money down and, in some cases, upgrade their devices earlier instead of the typical two-year subsidized window. Over time, we believe this could result in a compressed upgrade window for some iPhone users,’ according to Munster,” Swanson reports. “However, there does not appear to be any indication of a specific quarter when the tailwind will be recognized, and the analyst believes that the impact could be a more gradual albeit consistent one, spreading across multiple quarters, as users increasingly transfer to installment plans.”
“There are likely to have been about 21.4 million and 32.6 million smartphone users in the US on installment plans in 3Q14 and 4Q14, respectively, although not all were on 12-month upgrade plan and neither will everyone on such a plan exercise their upgrade option,” Swanson reports. “Even if 30 percent of the installment plan customers choose an early upgrade, it would total 6.4 million early upgraders in 3Q15 and 9.8 million in 4Q15. The analyst expects the U.S. iPhone market share to stand at about 45 percent in CY15.”
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MacDailyNews Take: iPhone 6s/Plus will set the all-time smartphone sales record, just like iPhone 6/Plus, iPhone 5s, iPhone 5, iPhone 4s, iPhone 4, iPhone 3GS, and iPhone 3G did before.