This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Cramer's Action Alerts PLUS - See his portfolio and get alerts BEFORE every trade. Learn more NOW!

Cube, Colors and Oblong Mouse Highlight This Year's Macworld

It's not every day that a new computer mouse moves thousands of people to applause. Macworld only happens once a year.

Apple's (AAPL - Get Report) annual New York trade show kicked off Wednesday with a keynote address from CEO Steve Jobs. His presentation was met with the usual enthusiasm from the rabid Apple faithful, who greeted each new iMac color that was announced -- indigo, ruby, sage and snow -- with all the reserve of a college hockey crowd.

Product highlights included an oblong optical mouse that replaces the round device that many users have found awkward to operate, and a new line of Power Macs with dual-G4 processors. Jobs concluded his keynote by unveiling Apple's new desktop product, the Cube -- a G4-powered machine that's crammed, as its name suggests, into an 8-inch cube suspended in a clear plastic case.

Analysts were generally positive. "Apple did two things today," says David Bailey of Gerard Klauer Mattison, which hasn't done any underwriting for the company: "They hit a lower price point in the consumer segment with the iMac. And they addressed the need of high-end consumers with the G4 Cube, which provides people with a G4 processor and the ability to go to 17-inch or flat display without taking up much real estate on the desk."

Recent evidence suggests that consumers have been migrating back toward high-end products after last year's trend toward cheap or even free PCs. Low-end PC maker eMachines (EEEE) has seen its stock sink more than 60% from its high after issuing an earnings warning.

Apple plummeted 8% Wednesday in the wake of an earnings report Tuesday that showed sales growing 17% in the second quarter from the year-ago period. Investors were spooked by CFO Fred Anderson's admission that sales of the company's flagship iMac computer were "relatively flat." ( TSC wrote a story Tuesday about the earnings.)

To Bailey, Wednesday's product announcements should take care of any sluggishness for Apple. "I think this will really reinvigorate sales of iMacs and Power Macs going forward," he says. (Bailey rates Apple a buy, his firm's highest rating.)

PC bears, for their part, were scoffing at that notion. "Steve Jobs did a great job with translucent colors," says Fred Hickey, editor of the High-Tech Strategist newsletter. "What do you do for an encore? This is probably one of the weakest bits of news out of a Macworld conference that I've seen. I don't see this driving any big demand." Hickey has no position in Apple.

"They've done a nice job upgrading the product line," he continues. "The poor Apple customers who hadn't seen any decent products for years on end were ravenous to buy, and did. But what's going to happen now?"

This week seems to have put the burden of proof on Apple.

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Try it NOW
Only $9.95
Try it NOW
14-Days Free
Try it NOW

Check Out Our Best Services for Investors

Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
Try it NOW
Try it NOW
Try it NOW
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
SYM TRADE IT LAST %CHG
AAPL $129.09 0.49%
FB $79.75 0.99%
GOOG $571.34 2.32%
TSLA $197.32 -2.96%
YHOO $44.11 -0.38%

Markets

DOW 18,288.63 +155.93 0.86%
S&P 500 2,117.39 +12.89 0.61%
NASDAQ 5,008.0960 +44.5690 0.90%

Partners Compare Online Brokers

Free Reports

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs