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AAPL Down With Markets
Stocks are down in early trading following a broad sell-off in Europe. Moody’s downgraded Portugal’s debt to junk status raising concerns about the European financial system. Shares of AAPL are not immune and are trading in the negative but near the flatline. Catalysts include second calendar quarter results released on July 19th at 5pm ET; the next iPhone launch this fall as well as the possible iPad 3 ahead of the holidays (see below); smartphone push into China and emerging markets; iCloud rollout and adoption; the continued evolution and next generation of Apple TV; and new platforms such as books / publishing and social (Ping). Shares of Apple trade at 11x Enterprise Value / Trailing Twelve Months Free Cash Flow (including long-term marketable securities), low versus historical standards.Apple Finance Board Calling For 90% Earnings Growth (Fortune)
The current consensus among Wall Street analysts, according to Thomson Financial, is that the company earned $5.69 per share on sales of $24.67 billion, up 62.1% and 57.2%, respectively. Impressive as those growth rates might sound, they’re anemic compared with what the amateur analysts at The Mac Observer’s Apple Finance Board (ABF) are forecasting. The AFB consensus is calling for earnings of $6.66 on sales of $26.56 billion, up 89.6% and 69.1%, respectively.
iTunes To Generate $13 Billion In Revenue By 2013 (Business Insider)
Apple’s iTunes platform will generate $13 billion in revenues by 2013, according to Global Equities Research. That includes sales of music, ebooks, movies and apps, and assumes growth of 39% over the next years, which sounds believable. The reason for the growth? All those iPhones and iPads. The most stunning thing about this is that Apple’s iTunes is usually thought of as an add-on, a way for Apple to sell more hardware.
Verizon iPhone Sales Falling From Initial Launch Quarter (Businessweek)
The Verizon iPhone, although more tepid than expected, has done consistently well and some are arguing it is responsible for the slowing of Android sales for the carrier (see below). However, sales might have finally tapered off, or dropped altogether, during the second quarter. According to Goldman Sachs telco analyst Jason Armstrong “IPhone sales will likely be a touch below the 2.2 million” Verizon sold in the first quarter.
Android Recent Acquire Growth Flattens Likely Due To Verizon iPhone (eWeek)
Nielsen discovered that while Android still paced the U.S. smartphone market with 38% market share through May (up from 36% in April), its growth of recent acquirers flattened over the last few months. The Verizon iPhone could be the culprit. Apple, whose U.S. smartphone share grew from 26% in April to 27% in May, saw its recent acquirer share grow 7 percentage points, from 10% from December to February to 17% from March to May.
Apple Passes RIM In Smartphone Platform Market Share But Android Crushing Everyone (comScore)
According to comScore, for the month of March Apple passed Research In Motion in terms of smartphone platform share. Apple claimed 26.6% of the market while RIM had 24.7%, a 4.2% drop from February. Google’s Android continued to crush the competition grabbing 5 percentage points to 38.1% market share. Android’s share is still blowing away all competitors. The only company that’s hanging on is Apple.
Apple Likely To Dethrone HP Next Year As Computer King If Tablets Are Included (Digitimes)
Apple is likely to replace Hewlett-Packard as the global number one notebook vendor in 2012 if tablets are included in the calculation of global notebook shipments. Some market research firms have predicted global tablet shipments are to top 80 million units 2012 with iPads accounting for 60 million units. Hewlett-Packard may be focusing its TouchPad intentions on the enterprise, but the business market won’t be enough to save it from relegation to second place.
Apple Set To Ship 12-14 Million iPads In The Third Calendar Quarter (AppleInsider)
Apple is set to dramatically boost shipments of the iPad 2 next quarter. The all-knowing sources are reporting that Apple is on track to see a massive shipment of iPads in the next quarter of 2011, with overseas suppliers indicating the total number of units shipped will be between 12 million and 14 million. That number could be inflated as rumours swirl of the iPad 3 coming in October.
iPhone 5 And iPad 5 To Be Available By October Ahead Of The Holidays (Digitimes)
Apple’s suppliers with parts have started to prepare materials for the production of the next generation iDevices; the iPhone 5 and the iPad 3. Apple is rumoured to unveil its fifth-generation smartphone and third-generation tablet in September ahead of launches in October (fourth calendar quarter). Taiwan-based notebook maker Pegatron Technology is estimated to have landed orders for 15 million iPhone 5s set to start shipping in September.
The iPad Already Accounts For 2% Of Internet Traffic In The U.S. (Net Applications)
Apple’s iPad is responsible for 1% of the world’s web traffic, as well as 2.1% of web traffic in the U.S., according to Net Applications. The iPad’s share of Web traffic has been steadily growing by 10% or more since March. While that may not seem like much, it does show that the Apple iPad is growing in popularity, with the Xoom And Galaxy no where in sight, and indicates how the device is being used. And only after being introduced a little over a year ago, it’s quite stunning.
Samsung, Biting The Hand That Feeds It, Drops One Legal Suit Against Apple (Bloomberg)
Apple asked a U.S. court to issue a preliminary injunction against Samsung on four patents in a dispute between the two companies as well as asked for a faster trial schedule to resolve all of its intellectual property claims against Samsung. After doing so, Samsung dropped one suit in efforts “to streamline the legal proceedings.” Apple was Samsung’s second-biggest customer last year after Sony, accounting for about $5.7 billion of sales to Samsung mainly by purchasing semiconductors, according to Samsung’s annual report.