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Apple Soon to be Most Valuable Corporation? Ping!
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Posted on 09/13/2010 5:16:04 PM PDT by Swordmaker
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Oh, I’ve seen this type of “analysis” before.
It doesn’t end well for the stock holders.
Oh, I’ve seen this type of “analysis” before.
It doesn’t end well for the stock holders.
Basing financial decisions on forward looking earnings projections is like planning your retirement based on what Congress will do 10 years from now...
It is amazing to think that this company was on the brink of death not too long ago and now is one of the best run companies in the world.
There was a recent Gartner study which predicted a significant reduction in market share for Apple in the smartphone market. By 2014 they were predicting it would be down to about 14% (somewhere about there).
Motely Fools did the saem analysis for Enron before it imploded. Apple will hold up but Motely Fools got payola on their radio show when they had Ken Lay on years ago and 10,000 cheering employees/kool air drinkers.
Lay and the “fools” were talking new pardigm BS.
Even if they maintain market share, the onslaught of Android phones is going to erode margins. ie, to maintain market share, the typical trade-off is lower margins.
Without any doubt at all.
It has really been surging this week!
Noone's life, liberty, or property is safe while Congress is in session...
Mostly nose picking based on the flatlining of iPhone 3Gs sales at the end of Quarter 2 as the buyers awaited the release of the iPhone 4... Seeing as how Apple has sold 11 million iPhone 4s since then, Gartner's conclusions on that report seem a little dated.
From this thread - http://www.freerepublic.com/focus/f-bloggers/2586715/posts
Which is about how Android is going to gain market share at the expense of others.
Symbian 30.2
Android 29.6
Research In Motion 11.7
iOS 14.9
Windows Phone 3.9
Other 9.6
I don’t think they have lowered their margins much if at all on their computers, which have also been improving in sales.
Gartner makes its money by being right a fair percentage of the time. I’m only saying there are other opinions out there that seem to be from more reputable and unbiased sources.
Before Apple's latest uptick in iPhone 4 sales, they already had 47% of ALL global cellular phone profits! Apple is not much worried about "market share." Profits are good enough. They are not in a race to the bottom of the barrel, and never have been.
I can’t fault their logic here. I’m not an Apple fan, but I recognize what they’ve done well, and like the return I’m getting. Ever since the Apple II they’ve capitalized on open systems, not it’s Apps, and it’s a valid point that once they get you, they’ve got you for the future as well. Good stock.
Apple is somewhat contrarian when it comes to margins, witness what they’ve done with desktops and portables. I look for Android to grow at the expense of other OS more than Apple, due to the change costs associated with existing apps. Since the hardware platform cost is roughly comparable, if it comes down to iOS vs. Android, there’s not a lot of reason to cut margins just to keep/gain share. Since Apple makes the hardware, owns the OS and makes money selling the apps, they could turn loose of some margin and still be highly profitable. But I don’t think they’ll even need to do that, just ride the technology curve.
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