updated 04:15 pm EST, Mon December 15, 2008
Amid the uncertainty surrounding holiday retail sales and the current economic recession, several analysts on Monday have presented contrasting forecasts for Apple stock. Goldman Sachs analyst David Bailey has downgraded AAPL from "buy" to "neutral," while Tom Smith of Standard and Poor's pushed his rating the opposite direction with a change from "buy on a valuation basis" to "strong buy." Bailey observed that shipments of MacBooks, iPod nanos, and iPhones fell slightly below expectations for the quarter.
The Goldman Sachs analysis considered the potential market conditions through the beginning of 2009. "Apple should face a tougher environment in the March and June quarters as consumer demand takes another leg down," Bailey said. iPhone sales could also miss targets for the first half of next year, although the numbers from 2008 far exceeded Apple's publicized goals. The evaluation also anticipates that the computer-maker will not introduce a significant product at the Macworld event next month.
Although both analysts lowered their price estimates for AAPL, expecting lowered consumer spending, Tim Smith anticipates that Apple is better suited that its competitors to weather the rough conditions. "While most peers also face weak demand, we believe AAPL has better potential for market-share gains in PCs and smart phones," he said.
Steve Jobs spoke during the Q4 financial conference call in October, reminding everyone that his company had $25 billion in the bank and zero debt. "This downturn may also present some extraordinary opportunities for companies that have the cash to take advantage of them, like Apple does," he said. The comment fueled speculation that the computer-maker could be considering acquisitions in addition to expanding its R&D investments.