TMO Reports - Analyst: 'Boot Camp to be Catalyst for the Halo Effect'

by , 12:50 PM EDT, April 7th, 2006

Piper Jaffray analyst Gene Munster on Friday issued a research report in which he examine the impact of Apple's release of Boot Camp and declared that it will be a "catalyst for the halo effect." With Apple's current worldwide market share at 2.5% and the analyst currently calling for that to remain flat this year and next, he called such an assessment "conservative" and said that he expects Mac market share to increase.

Mr. Munster shared tables that show how an increase in Apple's market share will impact Mac shipments, revenue derived from its computer division, and EPS (earnings per share). He projects that market share could reach 3.5% this year, which would result in just over 8 million Macs sold, an extra US$3 billion in revenue, and $0.33 added to EPS.

Next year, he thinks Apple could attain a market share as high as 5%, which would mean 12.7 million Macs sold, just over $8 billion added to overall revenue, and $0.85 added to EPS. While he assumed a $1,310 average selling price (ASP) this year, he dropped that to $1,280 in 2007, which would take into account increased sales of Apple's consumer models.

Mr. Munster retained his "Outperform" rating on Apple's stock, with a $103 price target. The company's shares had been in the doldrums for several weeks but awakened from their stupor when the Boot Camp public Beta was released on Wednesday. At 12:51 PM EST on Friday, however, Apple's stock was selling for $69.34, down 2.67%. Investors are likely cashing in profits from the stock's over 10% jump the past two days, rather than reacting to negative sentiment.

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