The tech-giant
Apple Inc.
(
AAPL
) proved its popularity yet again as the Consumer Reports' list
adjudged the "new iPad" to be number one in the tablet market.
Apple won over the allegations of the third generation 4G enabled
device emitting excess heat to snatch the top rank.
Consumer Reports noted that the heat emission issue was rampant
among other tablets such as
Google Inc.
's (
GOOG
) Android based Samsung's Galaxy Tab 10.1 and Asus
Transformer Prime when put through similar working conditions as
the iPad while "playing a demanding game with the screen fully
bright".
Alongside the "new iPad" in the popularity list, Toshiba's
ultra-light, Excite 10LE tablet version and
Sony Corp's (
SNE
)
Tablet P were also included, both Android-based tablets.
Since its launch earlier last month, the "new iPad" has been
performing exceedingly well with 3 million units being sold in the
first four days of its release. The "new iPad" is touted as the
next catalyst for Apple to drive home the advantage it already
enjoys in the tablet market with two-thirds of market share.
The distinguishable factor that has come across for the product
is its state-of-the-art Retina display, 4G connectivity, faster
processing speeds and a long battery life. With enhanced visual
capabilities and faster processing speeds, the "new iPad" is
expected to lure avid gamers away from traditional console gaming
platforms from the likes of
Microsoft Corp.
(
MSFT
) and Sony.
iPads constitute a significant portion of Apple's total revenue,
with sales of approximately 32.4 million units in fiscal 2011, a
massive 334.0% growth from the year ago. The momentum continued in
the first quarter of 2012, selling more than 15.4 million units,
almost double that of the 7.4 million units sold during the
year-ago period. Recognized revenues from iPad and accessories
during the quarter shot up 99.0% year over year to $9.2
million.
We expect the "new iPad" to boost revenues for the current
quarter and retain Apple's dominance (62.0% market share in the
FY11) in the tablet market. We believe that the latest variant will
help Apple storm ahead of its nearest competitors in the tablet
market, including the likes of Samsung Electronics and
Amazon.com Inc.
(
AMZN
), which are slowly but surely making headways in the tablet
market.
We conclude that Apple remains the biggest growth story, based
on its superior product pipeline, Apps, iCloud and iPhone 4S, the
"new iPad" and Apple TV. Apple is also well positioned to gain from
its loyal customer base and international expansion, in our
view.
Despite the impending patent lawsuits in various countries,
which might be an overhang on the stock in the near term, we are
optimistic about the company's long-term growth prospects.
Thus, we have an Outperform rating on Apple over the long term.
Currently, Apple has a Zacks #1 Rank, implying a short-term 'Strong
Buy' rating.
APPLE INC (
AAPL
): Free Stock Analysis Report
AMAZON.COM INC (
AMZN
): Free Stock Analysis Report
GOOGLE INC-CL A (
GOOG
): Free Stock Analysis Report
MICROSOFT CORP (
MSFT
): Free Stock Analysis Report
SONY CORP ADR (
SNE
): Free Stock Analysis Report
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