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Analyst expects cheap iPhone after meet with Apple CFO

updated 10:17 am EST, Fri February 22, 2013

Calls for 6 percent dividend in FY 2013

Apple will probably release a cheaper iPhone, says Morgan Stanley analyst Katy Huberty in the wake of a meeting with Apple CFO Peter Oppenheimer. Huberty says that innovation is still a "top priority" for Apple, and hence why she anticipates a bigger iPhone lineup, as well as unspecified services that could help "unlock significant value" and fuel further device sales. If it managed a one-third cannibalization rate and a gross profit margin of 40 percent, a low-cost iPhone could push up Apple's overall revenue and profit, Huberty suggests.

The analyst also argues that the company will probably return more cash to shareholders, possibly matching the average free cash flow payout in the S&P 500 IT sector, 68 percent. That would translate into about $28 billion in shareholder payouts for Apple's fiscal 2013, or a 6 percent total yield on the company's dividend. At the moment Apple's dividend has a 2.3 percent yield. Paying out the higher figure would involve borrowing cash, but Huberty proposes a workaround involving raising low-interest debt.

by MacNN Staff




  1. mac_in_tosh

    Forum Regular

    Joined: 12-14-11

    How about

    a cheaper Mac Pro?

  1. gmsquires

    Fresh-Faced Recruit

    Joined: 07-02-09

    Wishful thinking

    Another ANAL-ist not udnerstanding Apple. They are all pushing for Apple to do something to suit their preconceived notions as to what Apple should do. Apple generally doesn't "roll this way", and they all just don't get it. I would hazzard a guess that Oppie said they would consider cheaper iPhones, but that doesn't mean they will make a new cheap model. Apple already sells a ton of iPhone 4's and 4s' which is outselling the Samdung Gallaxy III. Why should Apple go down the road to the bottom?

  1. technomaster

    Fresh-Faced Recruit

    Joined: 10-22-03

    What does that mean?

    What doesn't really make sense is that Apple already offers a cheaper iPhone - they still sell the older 4S at a lower price now that the iPhone 5 is out. To me, Apple has already satisfied consumer need.

    Is the analysts' expectation that another absolutely brand new low end iPhone needs to be released concurrently with the next flagship? ie (the IPhone "Maxi" & the iPhone "Mini")

    The wording and classification of products at different price points does not clearly signifiy "low end".

    It could simply be a premium product meant to cater to users who don't want to spend as much. As such, it comes with a different set of bells and whistles.

  1. blahblahbber


    Joined: 02-01-05

    If anyone is interested in the latest creation...

    Meet the new mini M Pro, interested? How do I get pictures up on this site with this ever-changing comment section??

    PM me if you want to know more or even see the most advanced piece of equipment to date.... Dare to find out? I am not kidding.

  1. wrenchy

    Forum Regular

    Joined: 11-03-09

    Cheap iFone

    Apple is just figuring out what Android knew 4 years ago. A one size fits all, my way or the highway approach does not work with the majority of people. Fanbois that love anything Apple shoved down their throat, yes it works with them. People that want something that works FOR THEM, not so much.

  1. Arne_Saknussemm

    Forum Regular

    Joined: 04-05-11

    The Mac pro has long been dead.

    Pros abandoned the Mac even earlier than Apple did.

  1. Spheric Harlot

    Clinically Insane

    Joined: 11-07-99

    Originally Posted by Arne_SaknussemmView Post

    Pros abandoned the Mac even earlier than Apple did.

    …for a rather narrow and arbitrary definition of "pro".

    Most of the "pros" I've been working with over the past fifteen years have switched TO the Mac.

  1. Arne_Saknussemm

    Forum Regular

    Joined: 04-05-11

    when you need a multiprocessor system...

    You need it bad. The last time the Mac Pro was updated it was long over due; and still it was a rather minor update, considering the highest end Xeon available from Apple was a six core part, at a time 8 core processor systems were already available from mainstream workstation vendors for a price comparable to what Apple charged(and still charges) for it's twelve core system. A "pro" or someone thatthat makes a living using a high end system can simply not rely on an outdated system provided by a company more committed (at least for the last 8-10 years) on producing consumer and fashionable accessories rather ths high end systems with open standards and a high level of cutomizability.

  1. Spheric Harlot

    Clinically Insane

    Joined: 11-07-99

    So, did you read my post, or did the vague notion of being disagreed with simply trigger the need to pontificate at me in a random fashion?

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