Apple Even Better than I Thought
I have been digging around more on the iPhone story and the success of iTunes in selling videos and movies.
Did you know that:
- Last year, 1 billion cell phones were sold. Thats a huge market! If Apple can sell 1 million of these within 6 months, that is an additional $500 million to their 2007 revenues. If they sell 5 million, thats $2.5 billion more in revenues.
- 1.3 million movies were sold in 4 months via iTunes. This will only increase with Apple TV.
- Over 50 million videos have been downloaded using iTunes.
I believe Apple can earn $4 in 2007. If Mac sales continue to grow (and they should) and iPhone does not face launch delays, I believe the stock can see $200 by the end of this year.
– Faisal Laljee
Full Disclosure: I own AAPL for my portfolios but my position can change anytime without notice.
Stock will see $50 before it goes to $250.
Why will the stock see $50
- Becoming exclusive to Cingular is a big problem
- Majority of Cingular customers are under $40/month… Most don’t have data/internet services (Other provider’s have higher %age of customers with data/internet services)
- Cingular’s 2 Year contact is not something everyone is going to like
- Other phone manufactures and service providers will start offering free instruments (PDA’s) with 1 year contracts.
- The product has too many technical issues… No wonder it will be released in June (may be)
- Cingular does not bring anything to the table… I am not sure too many existing customers will like to pay $499 and sign a 2 year agreement.
- Possible new customers will have pay $200 to the current provider to break existing contracts + pay $499 + sign a 2 year contract and I have an ipod already… Not something I am too exited about.
- Will have to pay for the monthly data / internet service in order to use Google map / GPS.
- When people say 1 billion phones were sold last year they forget 2 points – a. 50% of these phones were sold in Asia and another 20% in Europe (Can’t sell iPhone in either markets today) and b. 80% of the phones sold world wide were sold under $100. Fewer than 20% of the cell phones sold world wide were sold for $100 and over (retail) so the market is not 1 billion.
Why will the stock see $250 after it has seen $50
- Apple will find a way to walk away from Cingular or will start selling unlocked GPS phones in Asia.
- Apple will have a new version available with state maps locally on the phone so one does not have to take internet / data services to use GPS/Google maps. So if I buy iphone I done have to buy a GPS for my car.
- Apple will release new phones with gaming (something like Sony PSP… It runs X”)
- Apple will release new low priced versions of the iphone (Less memory and no email/ internet/camera and a small screen) for low end customers.
- Add new features like Video SMS
- If Apple sticks to Cingular they will buy the company.
- And eventually sell a hand help ilaptop with gaming, GPS, phone, internet, music and all known app’s and go after Microsoft.
I am going to wait it out and not buy the phone or the stock for now.
http://www.blogger.com/profile/32921700
Lalit – Initially, the Treo too was just for one of the providers. You bring up some good points, but no one thought Apple would sell their $400 iPods by the truckload when there was the Zen from Creative, and other cheaper MP3 alternatives from SanDisk, Rio and iRiver. Yet they were not only able to sell the original iPod, but also many more generatios of them.
In fact, I could not believe that they even introduced something so dumb as the Shuffle. But they managed to sell those successfully too.
I think the iPhone will have some initial problems, but within 6 months of launch date, all issues/delays will be sorted out. I believe other carriers will sign up in 2008. I also believe that carriers will offer a $150-$200 rebate (they always do), which is a rebate offered by the carrier – not Apple.
If you still don’t believe consumers will buy this $500 phone, I can’t change your mind. But betting against Steve Jobs is a mistake. The only way this stock sees $50 is if it splits.
– Faisal
In a previous post, you incorrectly listed a Buffet investment’s (Tesco Supermarket)ticker symbol as “TESOF”. That is not the correct ticker symbol. The actual ticker symbol is on the pink sheets and I cannot find any relevant financial information on this Tesco Supermarkets.