MacBook good for Apple

Apple's newly launched MacBook Pro line is expected to boost its June quarter sales, according to one analyst who calls the product an "iPod companion." American Technology Research analyst Shaw Wu told clients that he expects the new product to help bolster Apple sales during the current June quarter, as it hit the market a few months before the analyst expected and well ahead of the educational buying season. "We have a higher degree of confidence that Apple is on track to hit the upper end, if not exceed its guidance of $4.2-4.4 billion in revenue and $0.39-0.42 in EPS." The company cited timing of the product release as a critical factor, widespread availability, and the product's competitive specs compared to similar offerings from other PC vendors: the MacBook "screams iPod companion and portable digital media center."

"We find the timing important as it is well ahead of the back-to-school buying season that starts in July and pricing and specifications appear very competitive," Wu said in his note to clients obtained by MacNN. "To us, MacBook screams iPod companion. Outside of students, we believe the product also makes a lot of sense for mainstream consumers, particularly switchers."

The analyst also said its checks indicate pent-up demand for the new consumer notebook offering as well as strong orders. On Amazon.com, Wu noted, the top three selling PCs are MacBooks beating out Toshiba, HPQ, Sony, and Acer. The products are much more readily available than the professional line of laptops introduced in January and are priced to sell.

"Pricing and specifications appear very competitive and a vast improvement from iBook, its predecessor," the analyst said. "There are three models with prices ranging from $1099 to $1499. We believe the entry-level system for $1099 is a particularly good deal that includes a 1.83GHz dual-core Intel processor, 13-inch widescreen LCD, 512MB of memory, 60GB HDD, iSight video camera, FrontRow with Apple remote, Gigbit Ethernet, WiFi, Bluetooth, Mac OS X Tiger, the iLife suite, and the option to run Windows XP through Boot Camp."

Two notes of caution

The company, however, is skeptical of Apple's pricing on the high-end black MacBook and is cautious about the possible cannibalization of sales from its high-end laptop line. Wu said that the $1499 high-end version with a black matte finish may be a little overpriced, but that Apple appears to be confident that some customers will pay the $200 premium for the black color.

"The MacBook is so powerful that we fear it could cannibalize sales of its high-end MacBook Pro. The only difference between the models are the screen sizes (15-inch and 17-inch vs. 13-inch) and graphics capability (ATI vs. embedded INTC graphics). Then again, the MacBook Pro is aimed at professional and high-end users."

The firm maintains a buy on Apple stock with $101 price target, saying that the company is well-positioned to capitalize with its "unique and defendable" iPod/iTunes and Macintosh franchise.

"We believe Appple is well-positioned to continue above market growth rates with arguably the industry's most powerful and complete stack of hardware, software, and service addressing the digital entertainment space," Wu said.

by MacNN Staff