) has reportedly cut its LCD orders by as much as 80 percent. If
true, this could be a serious blow to Japan Display, LG Display
and Sharp, all three of which depend on massive purchases from
companies like Apple. While Japan Display and LG Display should
survive the vacancy, Sharp may not. The Japanese display maker
has publicly admitted that it has
that it can survive its current economic situation, which
resulted in a full-year, record-breaking loss of $5.6
Sharp, which is famous for making Aquos television sets (and
quirky commercials that feature Gorge Takei and Despicable Me
minions), has been struggling to sell its displays. For years the
company promoted itself as being a manufacturer of high-end
HDTVs. While that strategy was initially successful, the company
was forced to adjust its pricing structure after Samsung, Vizio
and other firms took control over the market by selling
Contrary to the fears of some analysts and investors, however,
Apple's decision has nothing to do with its inability to sell
iDevices. Instead, Apple may have cut the orders of its current
LCD displays to make room for a vastly superior product.
Trip Chowdhry, the Managing Director of Equity Research at
Global Equities Research, has attended a number of display
conferences over the last year, as well as the 2013 Consumer
Electronics Show. During this period he formed the "converged
view" that Apple cut its orders "by 40 percent [to] 80 percent
not because the demand has declined by 40 percent [to] 80
percent, but probably because Apple is shifting to IGZO (Indium
Gallium Zinc Oxide) display technology."
Chowdhry hinted at Apple's future in TV manufacturing by
saying that IGZO is "ideal for large TV panels."
"IGZO is also ideal for flexible displays such as in the new
iPhones, iPads and MacBooks," Chowdhry told investors in an
e-mail. "IGZO has 40 times faster response time[s] than today's
"We view today's weakness in Apple stock as a buying
opportunity. We are reiterating our Overweight rating and a Price
Target of $650 on Apple stock."
Chowdhry's praise comes at a time when Apple is struggling to
maintain the gains it received more than 15 months ago. While the
company closed 2012 with a gain of nearly 30 percent, Apple lost
more than 19 percent of its value during the last three months of
the year. The company is down more than 11 percent
(c) 2013 Benzinga.com. Benzinga does not provide investment
advice. All rights reserved.
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