Thursday, March 29, 2007

Calls of Note Part 5

Couple of more comments on Apple (NASDAQ:AAPL):

- Prudential completed a tear-down analysis of the Apple iTV, which was released into the North American market last week.

The iTV looks like a scaled down PC. Intel's Crofton MPU (looks like a Dothan) and Calistoga chipset drive the device, along with NVidia's GE Force Go 7300 GPU. Broadcom's 802.11n WLAN chipset is in the version theypurchased, as is Realtek's Audio Codec and Fast Ethernet LAN controller.

On the memory side, Nanya and Samsung are the largest suppliers of DRAM, while Toshiba supplies a 40GB HDD. Other components are from Linear Tech (analog), Marvell (HDD SoC), International Rectifier (FETs), Cypress (Clock Chip and flash controller), Intersil (CPU voltage regulator), and Texas Instruments (analog and HDD motor controller).

While the Apple iTV is a high-visibility design win, they do not expect it to change the economic fortunes for most of its suppliers. PEG's Senior IT Hardware analyst, Jesse Tortora, who covers Apple, is forecasting only 800,000 and 1.8 million units to be shipped in 2007 and 2008, respectively.

- Morgan Stanley comments on PC's saying unit demand rebounded in February after a meaningful slowdown in January due to consumers waiting for Vista loaded PCs until late January. Total U.S. PC unit growth rebounded to a healthy 23% YoY in February, in-line with December 2006 growth. AAPL is the only vendor that appears unscathed by the Vista transition. Continued Mac momentum and strong double-digit iPod growth in the Q give them confidence that AAPL will beat expectations in the March Q.

Notablecalls: Not actionable but good to know category. Please scroll down for additional commentary on AAPL.

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