updated 11:05 am EDT, Wed October 21, 2009
TV segment may be fueling Apple stock
The host of CNBC's Mad Money, Jim Cramer, has called for an Apple stock price target of $300. In a recent episode of the program Cramer comments on Apple's fourth-quarter results, citing them as a reason for buying Apple stock despite it already being very expensive, hovering close to $200. Apple allegedly revealed in its results call that it is having a hard time keeping up with demand, not only in terms of the iPhone 3GS but many of its products, including Macs. Such a problem is a good one to have, Cramer suggests.
The host also remarks that the company has plenty of room for increasing iPhone sales, with only 3 percent of the market, and that it could come to dominate the smartphone industry in the same way it controls music players with the iPod. The company may further be poised to take home more computer sales, as it is a minority player but still doing damage to majority companies like Dell. Apple stock could climb as high as $390, Cramer argues, but a $300 figure is thought to be more plausible.
Critics of Cramer note that Apple has only admitted to 3GS supply problems, and that a week ago, the host was pessimistic about short-term Apple prospects. Analysts were likely to be disappointed by Q4 results because of a problem with iPhone production, he proposed, though the resulting stock drop was expected to be an opportunity to buy.
The latest Mad Money episode may nevertheless be helping to boost Apple stock, which surpassed the $200 mark on Tuesday. As of this writing the stock is valued over $205, an all-time high.