by Eric Savitz
Apple (AAPL) shares are higher this morning after bullish comments on the stock this morning from Citigroup’s Richard Gardner.
Gardner added the stock to something call the “Top Picks Live” list, which he describes as a roster of the company’s highest conviction ideas that was launched in January. He notes that Apple is the first PC hardware stock to be included on the list.
Gardner said that the 37% decline since the beginning of the year through Friday now fully reflects reductions in Q1 build plans for the iPod and the iPhone. (A subject I wrote about several times, as you may recall.)
Gardner said iPod unit growth is likely to remain “sluggish” in the calendar first half, but that PC build plans remain robust due to “strong demand, lean channel inventories, further expansion of the Best Buy (BBY) relationship and the recent introduction of the MacBook Air.” He also notes that the company will benefit from further deterioration of NAND Flash memory pricing, down 25% in January alone.
Gardner also said he still sees a 3G phone announcement in the first or second calendar quarter, with additional carrier relationships in Europe. And he thinks the percentage of iPhones unlocked and used on networks where Apple gets no residual payments will decline as the phone is launched officially in more countries. Gardner says his current estimates reflect a 20% unlocking rate, “which we believe is closer to a worst case than a median case.” (I would note that some estimates are higher, however.)
Apple this morning is up $3.02, or 2.4%, at $128.50.
No comments:
Post a Comment