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Wednesday, February 28, 2007

Calls of Note Part 2

- Goldman Sach's met with Tim Cook, Apple's (NASDAQ:AAPL) COO at the GS Technology Symposium. While there was no breaking news on the financial side, the meeting reinforces firm's view that AAPL shares represent a core holding and should be bought on any weakness. Most pointedly, Apple continues to reinforce its emphasis on and ability to innovate at levels that separate it from other companies. Firm's rating is Buy

Apple's unusual culture is embedded enough into Apple to virtually ensure a continuing string of breakthrough products beyond iMac, iPod, OS/X, and soon the iPhone, with the latter including sufficiently innovative features to enable Apple to achieve its fiscal 2008 10M unit targets even at Apple's higher price points. Indeed, Apple's 3-5 year outlook will extend it into new growth opportunities, partly a result of iPhone's reach. On other fronts, Apple once again addressed the issue of its iPod inventory exiting the December quarter and, despite some controversy in the investment community, the firm remains comfortable with its 200,000 unit iPod inventory build. Beyond that, the doubling of Apple's gift card business in the December quarter should lead to an uptick in iTunes revenue in the current quarter. Mac-wise, Apple continues to add to its string of substantially outgrowing the market.

Though this is a time when Apple shares are more subject to negative speculation, they continue to view AAPL as a stock that should be bought on dips over the next 3-4 months during the anticipation period in front of iPhone.

Notablecalls: Not actionable but good to know category. For you Apple fans out there.

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