This Day On The Street
Continue to site right-arrow
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
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Apple Remains Locked in Transition

Few software developers outside Apple have rewritten their programs to run natively on the Intel-based Macs, presumably in some cases because they expected to have until June before the new machines came to market.

Although Apple is including software on the Intel-based machines that will allow them to run software designed for machines based on PowerPC, those non-native programs will likely run more slowly than they do on the old machines, analysts warn.

Business users, in particular, who depend on applications such as Adobe (ADBE) Photoshop or Microsoft (MSFT) Word may be unwilling to move to the new Intel-based systems until those and other programs run natively on the Intel-based machines, they say.

"There's kind of a wait-and-see going on by consumers to try the new platforms and see how the software runs" on them, says Van Baker, an analyst with Gartner.

Beyond the risk of slow sales, by focusing its attention and resources on the Intel transition the company could be missing out on potential new markets, analysts say. Some expect this year to be a huge one for " digital living room " devices that allow users to play digital content stored on their PCs over their entertainment systems, for instance.

Thus far, Apple offers little for that market and could ostensibly fall behind its rivals there, analysts say.

Still, don't look for bulls to dump Apple's stock en masse. Many discount the soft computer shipment numbers as simply Apple clearing the way for the new Intel-based machines -- not as an indication that demand for the company's computers is slumping.

Many analysts also chalk up the company's disappointing guidance for the current quarter as company officials being overly conservative .

Worries that the company's computer sales may be faltering are overblown, says Noah Blackstein, a portfolio manager with Dynamic Mutual Funds, which is long Apple.

"It's Jan. 25. I'm not going to get concerned about a quarter that ends in March," he says.

And some analysts say that a focus on PC sales -- or even lost potential sales of new products -- misses the big picture. Apple's resurgence has been a result of the iPod, and that remains the most important story for the company.

"They'll get through the transition relatively fine, but I don't think it will have a big impact either way," says Darren Chervitz, research director at Jacob Asset Management, which is long Apple.

"Anything they do on the computer side is secondary to the iPod business."

3 of 3

Select the service that is right for you!

Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

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
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

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

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, 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
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

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

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
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!


DOW 17,804.80 +26.65 0.15%
S&P 500 2,070.65 +9.42 0.46%
NASDAQ 4,765.38 +16.9840 0.36%

Brokerage Partners

Rates from

  • Mortgage
  • Credit Cards
  • Auto

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