Apple’s new iAd mobile advertising network could add US$2.5 billion in revenue per year, and $1.00 in earnings per share, according to Broadpoint AmTech analyst Brian Marshall. Mr. Marshall said that while Multitasking was the big announcement in iPhone OS 4, iAd “stole the show and will be significant to the financial model.”
“In fact,” he wrote in a research note to clients obtained by The Mac Observer, “we believe the iAd platform could generate an incremental ~$2.5bil in revenue and $1.00+ to AAPL’s financial model when the business hits its stride.”
To put those numbers into perspective, ~$1.00 EPS would be ~10% more to his current calendar 2010 estimates of $12.75 for the company. That said, he cautioned his clients that he made numerous assumptions to arrive at those numbers.
“In our view,” he offered in summary, “Apple remains the best technology company on the planet with numerous catalysts on the horizon (e.g. international iPhone ramp, iPad ramp, emerging recurring revenue stream from content purchases/Ad sales, etc.). We currently see no real business model issues.”
Mr. Marshall reiterated a “Buy” rating on AAPL and a price target of $280. Late in the Friday trading session, Apple was trading higher at $241.29, up $1.34 (+0.56%), on light volume.
*In the interest of full disclosure, the author holds a small share in AAPL stock that was not an influence in the creation of this article.