The Mac Observer

Skip navigational links

You're viewing an article in TMO's historic archive vault. Here, we've preserved the comments and how the site looked along with the article. Use this link to view the article on our current site:
Analyst: Apple to Gain Mac Market Share

TMO Reports - Analyst: Apple to Gain Mac Market Share

by , 6:55 PM EST, March 16th, 2005

The iPod Halo Effect, security problems with Windows, and Apple's ability to use innovation to bring down pricing will lead to the company growing Mac market share over the next two to three years, according to a Wall Street analyst. In a research note obtained by The Mac Observer, Gene Munster of Piper Jaffray told clients that even a minimal gain in market share could have a "significant impact" on the company's earnings per share (EPS).

Noting first the iPod Halo Effect, the idea that people who buy iPods will look more closely at buying a Mac, Mr. Munster again stressed that Apple will gain converts to the Mac platform over time.

"Recently, Street focus has been on quarterly iPod unit numbers," wrote Mr. Jaffray. "While clearly Apple's domination in digital music is a critical piece to the story, we do not believe that iPod is the only potential growth avenue for the company."

Were Apple to grow it's share of the computer market by as little as 1%, said Mr. Jaffray, it could add 25% to Apple's EPS.

"Specifically, we believe that if Apple could grow its market share from 2.0% in CY04 to 3.5% in CY06," wrote Mr. Jaffray, "the incremental add to our existing EPS estimate would be $0.30, or 25%."

More importantly, growth of this nature has not been included in Piper Jaffray's financial models for Apple, on which the firm's Outperform rating and target price of US$52 per share is based. Mr. Munster has instead modeled for a growth in market of .3%, to 2.3% of the market, a number he called conservative in Wednesday's research note.

Mr. Munster reiterated his $52 price target and Outperform rating for Apple's stock, which means he expects it to outperform the markets.

Apple's stock closed higher in Wednesday's trading at $41.18, a gain of 0.22 (+0.54%), on moderate volume of 25 million shares trading hands.

*In the interest of full disclosure, the author holds a small share in APPL stock that was not an influence in the creation of this article.  


If you are interested in Apple's stock, join our forum members in the Apple Finance Boards, a moderated forum for Apple Investors and people who are interested in Apple's financial dealings. For other stories regarding Apple's stock activity, visit our updated Apple Stock Watch Special Report.

Recent TMO Headlines - Updated August 24th

Wed, 11:00 AM
TMO Daily Observations 2016-08-24: Interview with Andrew Tokuda, aka Digital Droo
Wed, 8:00 AM
Checking Your 'Find My Mac' Status (And Why You Might Need To!)
Tue, 7:55 PM
Parallels Desktop 12 Supports Windows 10 and macOS Sierra
Tue, 7:20 PM
North Korea Unveils Netflix-Like Service Called Manbang, Seriously
Tue, 6:15 PM
Tesla Battery Upgrade Will Boost Range to 315 Miles
Tue, 5:51 PM
Samsung Shuts Down Milk Because LOL
Tue, 2:01 PM
Capture 4K Video and Pics without the High Resolution Price Tag
Tue, 1:52 PM
LinearFlux PokeCharger Portable Battery: $39.99
Tue, 11:00 AM
TMO Daily Observations 2016-08-23: Interview with Victor Cajiao
Tue, 10:30 AM
Sony XAV-AX100 Adds CarPlay to Your Car for $500
Tue, 9:00 AM
Not Even NSA Can Keep Software Exploits Secret
Tue, 8:00 AM
Avoid Endless Scrolling: How to Quickly Return to the Top of a Page in iOS
  • __________
  • Buy Stuff, Support TMO!
  • Podcast: Mac Geek Gab
  • Podcast: Apple Weekly Report
  • TMO on Twitter!