Tag Archive | "aapl"

MMI: Cowen Cuts To Hold On Fading Tablet Prospects

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Shares of Motorola Mobility (MMI) are down $1.43, or 5%, today at $26.95, the worst performer in the S&P 500, after Cowen & Co.’s Matthew Hoffman lowered his rating on the stock to Neutral from Outperform, writing that the tablet prospects for the company are “fading” in the wake of yesterday’s iPad 2 announcement by Apple (AAPL), and that estimates are too high for the company.

Writing that the iPad 2 turned out to be “more competitive” than he had anticipated, and noting the earlier-than-expected ship date of March 11th, Hoffman cut his estimate for Motorola’s “Xoom” tablet computer to 2.2 million units this year from a prior 3.2 million, of which as many as 620,000 fewer units may ship in Q2, he estimates.

“The equation shifts more toward Apple — for now,” writes Hoffman.

With cash of $11 per share, Motorola may still be able to develop a “defendable long-term share position in tablets overall, and Android tablets specifically,” writes Hoffman, but “we now see that share ramp as a lower trajectory.”

This is the second downgrade in the last 24 hours that I’ve seen. Yesterday, C.L. King’s Larry Harris cut the stock to Buy from Strong Buy.

Article courtesy of Tech Trader Daily

Apple: Analysts See iPad 2 ‘A Compelling Case’

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Shares of Apple (AAPL) are up $5.89, or 1.7%, this morning at $358.01, retaining the glow of yesterday’s iPad 2 announcement that seems to have been met largely very favorably.

It doesn’t hurt that Gartner today cut their PC forecast for this year and next, based in part on their belief that the iPad and its ilk are delaying some consumer PC purchases.

Charlie Wolf, Needham & Co.: Reiterates a Buy recommendation and a $450 price target. Apple showed once again, he thinks, that “it’s more about software than hardware,” with the unveiling of the GarageBand and iMovie apps for the device. “iPad 2 immediately obsoletes a flood of media tablets that are finally beginning to appear a year after the iPad’s introduction,” writes Wolf. “Competitive tablets can emulate the hardware features of the iPad. But none can or probably never will match its software. Nor can they match its price.” Wolf left his estimates for this year unchanged.

Our conclusion is the sky’s the limit. And on that note, it was recently reported that the FAA has approved the iPad as a substitute for the paper charts pilots have traditionally used. This report suggests that the iPad could eventually become a fixture in the cockpits of every commercial plane. At this early stage it’s virtually impossible to size the iPad and media tablet market. In a previous note ( we estimated that the addressable market for media tablets could reach 875 million units. But its ultimate size might be far larger, depending on the imagination of software developers and users in the consumer and business markets.

T. Michael Walkley, Canaccord Genuity: Reiterates a Buy rating on Apple and a $460 price target. He’s impressed with the features and pricing on iPad 2 relative to the tablets he saw at the Consumer Electronics Show in January and Mobile World Congress in February. The price alone will “pressure sales of competing offerings including the Motorola [Mobility (MMI)] Xoom ($599/$799) as we believe consumers will overwhelmingly choose iPad 2 versus other tablets at these prices.”

Keith Bachman, BMO Capital: Reiterates an Outperform rating and a $410 price target. The iPad 2 was about as expected, no surprises. It’s a better produce in terms of industrial design and software, with iOS 4.3′s enhancements, and it has “several key competitive advantages,” including an early lead, the iOS “ecosystem,” the apps selection; the distribution channel (retail and carriers), the price, and the “supply chain optimization” Apple’s got.

Robert Cihra, Caris & Co.: Reiterates a Buy rating on Apple, while raising his price target to $460 from $450. He notes the March 11th ship date is a month earlier than he’d expected for the iPad 2. Echoing observations made yesterday by Sanford Bernstein’s Toni Sacconaghi, Cihra notes that, “Apple’s more aggressive iPad cost-vs-price strategy leaves no premium umbrella for commodity vendors to undercut on a spec-for-spec basis.” Any vendor thinking they can match Apple on that basis is “kidding themselves,” he writes. Cihra raised his March quarter (fiscal Q2) revenue estimate by a half a billion dollars to $24.5 billion and hiked his EPS estimate to $5.76 in EPS, up from $5.59, to reflect a higher iPhone estimate, at 16.6 million, up from a prior 16.1 million units, and higher Mac sales, at 3.85 million units, up from 3.7 million, and a higher-than-expected gross margin of 39.7%, versus his prior 39.4% forecast.

Brian Blair, Wedge Partners: The iPad was “significantly upgraded,” in his opinion, and a “technology leapfrog over the competition.” He reiterates a forecast for 45 million iPads sold this calendar year, and a 70% market share for Apple. On the component side, he expects that Qualcomm (QCOM) is supplying the baseband for the tablet. Blair notes that as far has he can tell, the rear-mounted camera on the iPad 2 is a 1.2 megapixel device, not a 5-megapixel sensor, which he believes may be a “slight disappointment” for OmniVision Technologies (OVTI), which might have been expected to sell its higher-end camera sensors into the iPad 2.The worst news for competitors is the price: “The critical price is the entry-level model, which at $499 sets a difficult bar for competitors to meet this year.”

Tavis McCourt, Morgan Keegan: Reiterates an Outperform rating on Apple and a $441 price target. There was nothing extremely surprising, he notes, but “other vendors will have difficulty selling 10-inch tablets at similar price points and functionality as Apple.” But the tablet category as a whole is still “incrementally positive for nearly every smartphone vendor adding this form factor.”

Brian White, Ticonderoga Securities: Reiterates a Buy rating and a $550 price target. White, who on Tuesday said Apple would have to make a “compelling case” to consumers for the device, writes that “the day could not have gone better.” “We believe Apple made a compelling case for why iPad 2 has the potential to further accelerate the momentum initially provided by the iPad 1, and in the process, provided investors with greater confidence that Apple is well positioned to maintain its leadership position in the rapidly growing tablet market.” White argues the price gives consumers “bang for their buck,” and he lauds Apple’s “Smart Covers,” flaps made of leather or polyurethane, that snap on with magnets, as partly “granting our wish” for the iPad to come in colors, something he sees as a differentiator.

Richard Gardner, Citigroup: Reiterates a Buy recommendation and a $415 price target, while standing by his prior estimate for sales of 6 million iPads in the current fiscal Q2, and 27 million units this fiscal year. He sees Apple retaining 80% share of the tablet market this year. “Based on the announced tablet offerings, we believe comparable tablets will need to price meaningfully below the iPad in order to take share in this market,” writes Gardner. “We view this as highly unlikely given that competitors would essentially be breaking-even or losing money at those prices.”

Mark Moskowitz, JP Morgan: Reiterates an Overweight rating and a $450 price target. Apple raised the bar for the tablet market. “Considering the competitive launches so far, with higher price points or clumsier form factor/technical specs, our assumption of Apple’s tablet market revenue share at 68% in 2011 may be conservative, particularly after today’s iPad 2 rollout.” The improvements in the form factor are “more than good enough,” writes Gardner, and the tech improvements, such as the new A5 chip, are also more than good enough, as far as he’s concerned. GarageBand and iMovie may extend the devices appeal to the 8- to 18-year-old age category, he thinks.

Article courtesy of Tech Trader Daily

RIMM May Bring BBM Software To iPhone, Android: BoyGenius

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Jonathan Geller with Boy Genius Report this morning writes that Research in Motion (RIMM) will provide the BlackBerry Messenger, or “BBM,” as it’s known, a popular instant-message style communications program widely used on its BlackBerry phones, as a software offering running on Apple’s (AAPL) iPhone and also on phones using Google’s (GOOG) Android operating system, citing anonymous sources.

“According to our sources, RIM has not yet finalized details surrounding timing or pricing, but we have heard that the company might make the software free to all users,” writes Geller. “We’re also told strategy is still being developed.”

Article courtesy of Tech Trader Daily

Moto Mobility: CL King Less Enthused After iPad 2

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The first negative fallout from Apple‘s (AAPL) unveiling this afternoon of its iPad 2, at least from a stock ratings standpoint, is a downgrade by Lawrence Harris of C.L. King, who cut his rating on shares of Motorola Mobility (MMI) from Strong Buy to just Buy, while cutting his target price from $40 to $34.

The big negative surprise for Moto today is price and availability — both challenging for Motorola’s “Xoom” tablet, which went on sale last week and appears to be struggling in initial sales.

The iPad 2’s features, which include a dual-core processor, front and back cameras and HDMI output, appear to match most of the high-end attributes of the Motorola XOOM,” writes Harris, while the price tag — $729 for the model offering WiFi and 3G wireless service, with 32 gigabytes of memory — “is likely to represent strong competition” for the Xoom, writes Harris.

Still, Harris finds the stock attractive given that it has almost $11 per share in cash, and given that sales of Moto’s “Atrix” phone at AT&T (T) “appear to be healthy.” He’s looking forward to the introduction of the “Bionic” smartphone at Verizon Communications (VZ) in Q2, as well as additional tablets later this year.

Moto shares fell $1.12, or 4%, today to $28.38.

Article courtesy of Tech Trader Daily

Apple: iPad 2 Out March 11th; MMI, RIMM Slip

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Folks, we had an unfortunate malfunction in our blog infrastructure here at Dow Jones, but we’re back on the scene.

Fortunately, there was nothing at all going on this afternoon.

Apple’s (AAPL) media event in San Francisco has been underway since 10 am, Pacific, 1 pm, Eastern. Sadly, I was not able to attend, but several smart folks have been covering the event live, including my friend Eric Savitz over at Forbes, and the folks at Engadget, who did a bang-up, smashing job as usual. Bravo, guys and gals.

Apple’s shares are up $2.90, or 0.8%, at $352.21. And how are the tablet competitors faring this afternoon? Motorola Mobility (MMI)  stock is down $1.04, or almost 4%; Research in Motion (RIMM) is down 21 cents, or 0.3%, at $66.19; Hewlett-Packard (HPQ) is up 49 cents, or 1%, at $43.40.

Apple’s CEO Steve Jobs unveiled the new version of the iPad, and surprised many by saying the device would ship on March 11th, sooner than the April availability one would have presumed based on last year’s iPad roll-out. The machine is priced the same as the old one, despite plenty of new bells and whistles.

Jobs came on stage at the open, leading to a standing ovation. He kicked off with a discussion of the company’s iBooks store, with 100 million downloads of books “in less than a year,” and with the announcement that Random House is going to be offering 17,000 titles through the store. Random House had been the one major publisher that held off on iBooks, but word came out Monday the company had finally agreed to go by the “agency” pricing model for books that Apple has been pushing.

Jobs said the company had surpassed 200 million accounts across iTunes, the App Store, and iBooks, making it the “most accounts with credit cards anywhere on the Internet,” he said.

Developers, Jobs noted, had earned a cumulative $2 billion selling programs through the App Store, Jobs said.

Moving to the iPad, Jobs said the tablet computer had sold more than any other tablet computer ever, at 15 million units, and that competitors had been “flummoxed,” especially by the device’s low price.

Jobs dubbed 2011 “The Year of the Copycats” as regards competing tablets, though he later reversed course, saying this will be the year of the “iPad 2.”

iPad 2 features a custom processor, the “A5” chip, running twice as fast as the “A4″ design in the first iPad, with 9 times faster graphics, and the first processor using two CPU “cores” to “ship in volume,” Jobs said. (Motorola’sXoom” tablet is first to market, but reports are it may be struggling to sell, so far.)

As widely speculated, the device features cameras on the front and back, and a gyroscope like that featured in the iPhone and iPod Touch.

The iPad 2 is a third thinner than the original model and thinner than Apple’s iPhone 4, at 8.8 millimeters versus the iPhone 4′s 9.3 millimeter thickness.

It is also lighter than the existing model, at 1.3 lbs versus 1.5 lbs for the first iPad.

Again, as speculated, the iPad 2 will come in not just the existing black finish, but also a white model, Jobs said. To much applause, Jobs said that the white version would ship “on day one,” in contrast to the repeated delays in the white model of the iPhone 4, that was expected last summer but still has not materilized.

Jobs said Apple was keeping the same price range for the new devices, ranging from $499 for a 16-gigabyte model with only WiFi connections, on up to $829 for the 64-gigabyte model with 3G.

Jobs showed off a new cover, in cloth and leather versions, that attaches to the iPad via magnets, and that can be peeled back to automatically wake the iPad.

The latter part of the presentation focused on the next release of the iOS operating system that runs the iPad, iPod, and iPhone, the “4.3″ release. Apple’s software director Scott Forstall took the stage to talk about some of the improvements, including faster performance of the Safari Web browser. The software also adds a “Personal Hotspot” feature to the iPhone 4 to allow it to share its Internet connection over WiFi with other devices.

Forstall showed off FaceTime video conference on the iPad, and also the company’s “PhotoBooth” program for taking pictures, and Jobs returned to the stage to announce the company would be offering a version of the iMovie program for the tablet, similar to the app offered currently for the iPhone, but with more extensive features. Jobs also said the company would bring its GarageBand music program to the iPad. The iPad’s built-in accelerometer can be used to simulate real-world instrument aspects, such as changing the force on a keyboard displayed on screen.

Jobs finished the presentation with a manifesto laying out how competitors were missing the mark:

It’s in Apple’s DNA that technology is not enough. It’s tech married with the liberal arts and the humanities. Nowhere is that more true than in the post-PC products. Our competitors are looking at this like it’s the next PC market. That is not the right approach to this. These are pos-PC devices that need to be easier to use than a PC, more intuitive.


Article courtesy of Tech Trader Daily

NYT: Here Comes The Paywall, Soon

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The Gaurdian’s Josh Halliday this morning offers some tidbits from The New York Time’s (NYT) chairman Arthur Sulzberger, appearing at the Financial Times’s Digital Media conference in London today.

Sulzberger said that the company will put up its paywall “very shortly,” and that the company does not expect to see a “massive drop in traffic.” Sulzberger defended the company’s investment in 1,150 journalists and 25 bureaus at a time of downsizing in the industry.

Sulzberger also reiterated an intention that the app for the New York Times on Apple’s (AAPL) iPad will be cease to be free at some point, though he wouldn’t get into details or timing, according to Halliday. As for the tussle between publishers and Apple, Sulzberger chalked it up to just another form of dealing with newstands, something publishers have always done.

Plus, Steven Brill — remember Brill’s Content? — was on the panel with Sulzberger and said he expects the Times can make $80 million to $100 million in new revenue each year with its paywall, while holding onto 90% of its online audience. No word on how much he thinks it will cannibalize print circulation.

In related news, NY Times’s CEO Janet Robinson this morning said, “The pay model for NYTimes.com is in the final testing phase, and we expect it will launch shortly.”

Her remarks were in advance of an appearance later today at the Morgan Stanley Tech, Media and Telecom conference.

Robinson has good reason to move as fast as possible into digital: expenses are rising, particularly newsprint. Robinson this morning said the company is seeing a 1% to 2% rise in operating expenses in the current quarter because of higher newsprint prices, pension expense and promotion costs.

She said print ad rates revenue declined “in the low single digits” as a percent in February, similar to January’s trend.

NYT shares are down 16 cents, or 2%, at $9.96.

Article courtesy of Tech Trader Daily

Apple: Swisher Urges ‘A Level Of Respect’ Should Jobs Appear

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Kara Swisher with AllThingsD today writes in her “BoomTown” column that several anonymous sources close to Apple (AAPL) suggest CEO Steve Jobs is “definitely considering” making an appearance tomorrow at the media event the company is hosting in San Francisco.

At least one Website this morning claimed to have information Jobs might appear tomorrow.

But, writes Swisher, “what BoomTown would like to see would be more of a focus on the iPad 2 itself, rather than armchair diagnoses of Jobs’ fitness based on any appearance he might make.”

Swisher urges the press, “show a level of respect to him by paying more attention to what bells and whistles the iPad 2 has rather than to how his jeans are fitting.”

Swisher notes Jobs recently appeared at the left hand of President Obama during a dinner in Silicon Valley, among other public appearances Job has made of late.

Article courtesy of Tech Trader Daily

Tablets: In-Stat Models Slower Tablet Growth

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Research firm In-Stat today declared tablet computer shipments will surpass 58 million units annually by 2014, citing data from an online survey of “18,000 technology users and decision makers,” which yielded 1,132 respondents, a sample copy of which was emailed to me.

The general sentiment of the report is fairly bullish — “The following year is slated to be pivotal for tablet adoption,” the authors write, no pun intended, I’m sure.

The numbers, however, are rather low, at least by comparison to some Street estimates, and slightly confusing.

In-Stat projects total tablet computer shipments rising from 13.8 million units last year to 23.7 million this year, 35 million next year, and 46 million in 2013.

As Apple (AAPL) alone shipped 14.8 million iPads from April of last year through December 25th, the 2010 number itself doesn’t seem to quite add up. It would certainly seem not to reflect any sales whatsoever of Samsung’s (SSNLF) “Galaxy Tab” device.

I have a call in to In-Stat to clarify.

Note that JP Morgan’s Mark Moskowitz and colleagues this morning offer a much more aggressive estimate of 47.9 million units just in this calendar year, which is more in keeping with other Street estimates I’ve seen.

Among the forces propelling tablet growth this year, In-Stat writes that, “Applications like complex games that are more immersive, compared to those designed for smartphones or other mobile devices, will be developed at a rapid pace this year, helping to drive content and therefore demand for tablets.”

Article courtesy of Tech Trader Daily

PCs: JP Morgan Cuts Est. On China, Rising Tablet Forecast

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JP Morgan hardware analyst Mark Moskowitz this morning cut his estimates for PC sales this year, warning, “It’s bad out there,” because “broader PC demand conditions are further softening.”

Moskowitz cut his estimate for PC unit growth this year to 7% from a prior 9.5%, from 383.93 million units shipped to 375.3 million units, with a lower estimate for both desktops and notebooks. He now sees 3% revenue growth for the industry, down from 4.5% previously.

China is the main culprit: “The region had been the growth engine for PCs over the past couple of years. Currently demand has stalled out in that region and potential remedies could be deferred.” I would note that Hewlett-Packard (HPQ) last week reported weaker-than-expected results for its sales into China, but not much was made of it at the time, the sense on the Street being that it was an issue specific to HP.

Moskowitz adds, “Growth is slowing in [China's] Tier 1 through 3 cities, and end demand has collapsed in Tier 4 through 6 cities. No specific sources are cited for the diminished China outlook. The country represents about 20% of PC units, he notes.

Other factors Moskowitz cites include the weak consumer PC reports by HP and Dell (DELL) in their respective quarterly reports, and, “the ongoing tablet invasion has resulted in consumers deferring PC purchases.

With a slew of new tablet offerings expected post the release of Google’s (GOOG) Android 3.0 operating system (Honeycomb) this spring, we expect consumers to become even more distracted by the tablet invasion, which stands to hurt PC sales growth potential.”

In a separate note today, Moskowitz lifted his tablet computer forecast from 46 million this year to 47.9 million units shipped. For next year, he is modeling 79.6 million units, up from 78.2 million previously. Out of the 2012 total, 35% of tablets sold will represent cannibalization of PCs, he writes. Moskowitz sees tablets becoming a $35 billion annual revenue opportunity by next year.

Moskowitz also, by the way, sees Apple (AAPL) hanging onto 60% of the market in 2012. “Our assumption is that Apple’s dominance will remain firmly intact in the near to mid-term, but gradually, ethnology improvements and component cost declines will enable competitive offers to loosen some of Apple’s grip.”

And lest you consider corporate purchases a bastion of safety, Moskowitz also cut his enterprise PC sales growth projection to 7.7% from 9.2%, arguing that corporations are seeing longer useful lives in the PCs they own, thereby stretching out the replacement cycle.

Article courtesy of Tech Trader Daily

Apple: FBR Sees Stepped-Up iPad Production

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FBR Capital semiconductor analyst Craig Berger this morning writes that his supply chain contacts are projecting a faster ramp for Apple’s (AAPLiPad 2, which is widely expected to be introduced to the world this Wednesday.

These contacts tell him Apple has increased its total production of iPads in the current quarter to 5.5 million units, from a prior projection of 5.1 million, and that production of the iPad 2 is expected to account for about 2 million of those units, which he takes as an indication that some “key bottlenecks,” such as touch screens, were resolved, boosting the yield from a prior 300,000-unit projection.

Q2′s production may be 7.2 million units, almost all of it iPad 2. That’s a greater proportion than the 50-50 split he had previously understood for Q2 between the old and the new model.

Article courtesy of Tech Trader Daily