financial/investor
08/08/2005, 2:00pm, EDT
Monday, August 8th
Market dubbed "Wrong" on Apple
An article today released by Morningstar Growthinvestor analyzes Apple Computer, concluding that it has a "fair value estimate" of $29 per share. The value, which signficantly contrasts from Apple's current $42 per share price, is the result of Morningstar's analysis, which assumes 25 percent annual revenue growth over the next five years for Apple; significant iPod growth this year and next; and sales declining thereafter due to lower prices and increased competition: "In our view, iPod revenues will eventually decline as alternative music players emerge and the early-adoption phase comes to an end. At the same time, we think the iPod will drive increased adoption of Apple computers, resulting in the firm's PC market share (1.8% in 2004) expanding to more than 3% in a few years."
Filed under: Investor
, 
, 21
, 
, 
, 
, 
, 
Top
subscribe to comments
for this article
which brings me to my next point, now that the iPod is late in its 4th generation shouldn't that whole "early adopter" phase be ending just about now?
I would say that with each iteration they add something so each generation seems sufficiently "new" to those who may not have bought one before and attractive to those who bought a previous generation unit.
Next, they'll tell you the Earth is flat. No really! Everyone's wrong!!!
...
Though I did think their target for Mac market share was a tad low.
And it's even more a figment of your (and my) imagination that the iPod is years and years and years old and the early adopter phase is long gone.
But then we're not market analysts. No-one cares about figments of our imaginations.
"how long can Apple really stand a concentrated Microsoft onslaught and companies selling at a loss to steal share to Windows sound formats?" A long time. This is probably the biggest challenge they've ever had to deal with. They have no leverage to threaten record labels and they are not used to winning by innovation.