updated 02:30 pm EDT, Wed April 5, 2006
\'Boot Camp\' helps future
Analysts believe that Apple's Boot Camp technology, released as a public beta earlier today and expected to ship as part of Mac OS X Leopard, could boost sales of Apple's operating system and signal an opportunity for marketshare gains. "we believe AAPL could benefit from a significant OS upgrade cycle starting in its December quarter," UBS analyst Ben Reitzes told clients. "We believe this move positions Apple to gain share with customers reluctant to purchase Macs due to concerns over interoperability with Windows systems (currently over 90 percent of the PC market)." Echoing sentiments similar to that of other analysts, Reitzes also believes that Apple is well-positioned to benefit from Mac share gains due to the "iPod Multiplier Effect," though a recent survey showed a disconnect between the iPod and Apple brands.
In addition, Reitzes said the Boot Camp software could increase Mac sales in the longer term, although it acknowledged the near-term risks.
"We estimate fiscal December quarter unit growth of 29 percent year-over-year to 1.6 million units and year-long 2007 unit growth of 29 percent to 6 million Macs." The firm also believes that Boot Camp could help drive profitable software sales with a compelling Mac OS X Leopard upgrade.
The firm reiterated its 'buy' rating on the stock and has a $95 price target based on an EV/sales multiple of three times its fiscal year 2007 estimate, which is higher than Apple's "pre-bubble" multiple and its peers due to faster growth and higher margins.