The Apple Investor is a daily report from SAI. Sign up here to receive it by email.
AAPL Down/Flat As The Market Tanks
The market is down in early trading on more news about financial instability in Europe. Shares of AAPL are mostly down, close to flat, in early trading. Upcoming catalysts for Apple include monthly NPD data (Mac / iPod business); holiday iPhone and iPad sales updates and carrier expansion (Verizon); new content revenue streams such as video, books, newspapers and social (Ping); moving iTunes into the cloud; and the uptake of the new Apple TV. Shares of Apple trade at 15x Enterprise Value / Trailing Twelve Months Free Cash Flow (incl. long-term marketable securities).
Analyst Ups Estimates And Price Target (Barron’s)
Kaufman Brothers analyst Shaw Wu raised his price target on shares of Apple to $395 from $380, writing citing momentum for Apple’s iPhone and iPad. Trends appear to be better than anticipated as Black Friday shopping madness has carried over leading to shortages of the iPod and the MacBook Air. For the holiday quarter Wu now sees $24.2 billion (up from $23 billion) in revenue and $5.36 in EPS (up from $5.12). Apple has guided (sandbagged) to $23 billion and $4.80 for the quarter.
Sony Knows iOS Is A Threat, Launching PlayStation App (touchArcade)
In a curious but wise development, Sony is on the verge of releasing an official PlayStation iPhone app. Players will be able to connect to PSN to see their trophies and see what their friends are doing as well as browse through game listings, get hardware information, see announcement, and then share through all social media outlets. Plus “tons more features” in the future.
Apple Picks Up Patents To Fight Ongoing Lawsuits And Prep For Next-Gen Network Fight (Foss Patents)
A number of Novell patents recently went up for grabs. Apple has decided to team with Microsoft and consortium (CPTN Holdings LLC), to pick up the patents for $450 million. Apple is reportedly interested in buying at least a few of the other 4,000 patents said to be worth over $1 billion. Likely more ammo in a few different ongoing lawsuits as well as a better foundation for building next-generation networks.
Official Launch Date Is Set For Mac App Store: Jan. 6 (Apple)
The Mac App Store will open for business on Thursday, January 6, 2011. Based on the company’s prior App Stores, the service will offer free and paid software available in 90 countries. Apple is rewriting the rules and changing the economics of software distribution. Developers can set their own prices, keeping 70% of the revenue without incurring charges for hosting, marketing or credit card fees. The Mac App Store won’t be an overnight success, but once developers start rolling out cheap but quality apps, forget about it.
Amazon Can’t Make A Dent In iTunes (The Wall Street Journal)
Amazon‘s share of the paid digital-download market rose to 13.3% in the third quarter, from 11% the year earlier, according NPD Group. Meanwhile, iTunes’ share rose to 66.2%, from 63.2%. Distribution executives at record labels say the disparity between the two may be even steeper, with Amazon commanding just 6% to 10% of the market in any given week, and Apple closer to 90%. One of the reasons, Amazon launched digital music downloads four years after Apple launched iTunes and it’s still playing catch-up.
Business Insider Emails & Alerts
Site highlights each day to your inbox.