Apple Computer stock has climbed to a four month high as investors and analysts await the "Showtime" media event scheduled for Tuesday, September 12. Apple is expected to announce an iTunes movie download service, and UBS analyst Ben Reitzes predicts the company will make "a major move into the digital home."
The progression Apple is making into the home entertainment market is also likely to boost Mac sales as more consumers latch on to the iPod and other Apple products like the iTunes Music Store.
He says "We believe [Appleis] evolving ecosystem can lead to higher sales of Macs given OS Xis unique ability to bridge the digital divide in conjunction with iTunes."
Mac products are already performing at better than expected levels, and the iMacis upgrade on September 6 coupled with upcoming products are likely to carry strong Mac sales into 2007. iPod sales, which have been lower, are also likely to see a boost if new nano models are introduced next week.
Mr. Reitzes is maintaining his "Buy" rating on Appleis stock and is raising the target price from US$80 to $92. He also bumped up his fourth-quarter earnings estimate a penny to 50 cents from 49 cents a share, and revenue forecast from $4.63 billion to $4.65 billion. 2007 earnings estimates are now $23.9 billion, up from $.23.7 billion.
Apple stock is currently trading at $72.71, up 2.68 (3.83%).