The Apple Investor is a daily report from SAI. Sign up here to receive it by email.
AAPL Up Despite Rocky Market
Markets are off in early trading with shares of AAPL bucking the trend up nearly 1%. Investors remain focused on the revamped iPhone 5 launch next month; iPad proliferation and the rumoured launch of the “mini”; market share growth of the Mac business lines; the introduction of the anticipated Apple TV set and related products; and evolution of platforms such as Siri, iAd and iBooks. Shares of Apple trade at 10.3x Enterprise Value / Trailing Twelve Months Free Cash Flow (including long-term marketable securities).
Why Has Apple Gone After Samsung? (Forbes)
The court is in session. Many people have wondered about the timing and why Apple went for the action. The consensus is that they want to put a marker down before some mythical ‘game changing’ technology is brought to market. The obvious changer is the next iPhone. But the next few years will be about a complete change of the ecosystem in the home. Capturing the living room. Who’s the biggest TV supplier in the world? Who’s market share would Apple be targeting aggressively? Who has the most to lose and would need to react to Apple as quickly as possible? Who’s been hauled into court by Apple to stop them ‘copying’? Samsung.
What Does Apple Really Want From Samsung? (BetaNews)
Answer: 100% of all profits gained from Samsung’s smartphones and injunction barring sales of future models. Yes, you read that right. Apple feels entitled to everything. That’s how highly the company’s top-brass thinks about their intellectual property and how little they do about Samsung’s. On top of that, Apple wants damages for lost profits, in this case $500 million just for that, with interest and costs. And then it wants ‘similar remedies’ for trade dress infringement and dilution as for patent infringement. Here’s how Apple proposed peace with Samsung.
Financial Insights From The Apple-Samsung Trial (BI Intelligence)
The landmark patent trial between Apple and Samsung has forced both companies to open up their books. Here’s what we learned: Apple leans a lot more on U.S. sales than Samsung. The U.S. market accounted for 32% of iPhone sales last quarter. Since the beginning of 2010, U.S. sales have averaged 32% of total sales. U.S. revenue was 32% of total revenue, but it is historically a bit lower than sales share. It has averaged 30% of total revenue since 2010 because U.S. ASP has tracked below the overall ASP for iPhones, but that gap is closing. The story is pretty similar with the iPad. Read the full article by subscribing to Business Insider’s premier research service, Business Insider Intelligence.
Apple Price Target: $950 Per Share (Seeking Alpha)
Seeking Alpha contributor Robert Paul Leitao is updating his 12-month Apple price target to $950 per share, representing an expected share price appreciation of 52.8% from Friday’s close. Over the next twelve months, he expects Apple to deliver about 50% revenue growth based on the continuing success of the iPhone and iPad product lines. He also expects a moderation in average gross margin to deliver EPS growth of about 60%. Over the long-term, Apple’s pace of product innovation and overall equity market conditions will have a greater influence on the share value than a stock split that may or may not occur over the next twelve months.
How Much Is The Apple Brand Worth? (WSJ via 9To5Mac)
The value of Apple’s brand varies greatly depending on who is taking the survey. Apple’s brand may be worth as much as $183 billion, according to a Millward Brown study, but only $33.5 billion according to an Omnicom Group Inc. survey (half as much as Microsoft). Why such a big difference? “The value of brand is both art and science,” says Allen Adamson, a managing director of Landor Associates, a branding firm owned by WPP. “It’s simple in theory but hard to pin down in reality. It’s really about how much would a consumer pay for a caramel coloured soda versus how much they would pay for a Coke.”