Piper Jaffray Raises Apple Target, Says Co. is Hoarding iPod Inventory

Piper Jaffray on Monday raised its 12-month price target for Appleis stock from US$68 to $79. In addition, analysts Gene Munster and Michael Olson detailed the results of the retailer survey they conducted at the end of the holiday weekend, noting that while all 11 third party stores were out of stock of certain iPods, only two of the 10 Apple stores they contacted had any shortages of the popular device.

Mr. Munster and Mr. Olson concluded: "Based on limited iPod availability (during times of peak demand) outside of Apple retail stores and apple.com, we continue to believe that some Street estimates for iPod unit shipments for the December quarter are too high."

They currently expect Apple to ship nine million iPods during the current quarter. "While we do believe slight upside to our estimate is achievable," they wrote in their research report, "we do not expect Apple will be able to ship the number of units that are already anticipated in some Street models."

Looking ahead to 2006, the analysts do not expect Apple to slow down its pace of new iPod introductions, as well as updates to existing models. With the transition to Intel processors expected to begin next year, they also see 2006 as "a significant year for the Mac line, [with] more changes to the Mac lineup than were seen in 2005."

Shortly after noon EST on Tuesday, Appleis stock was trading for $69.73 per share, up 0.56% for the day. While both the Nasdaq and the Dow were down overall, Apple shares were buoyed by not only Piper Jaffrayis research report but also comments made by other analysts, as The Mac Observer detailed earlier today.

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