Apple has always been the story that just appears too good to be true. And by recent investor activity it seems that some skeptics are ready to lift the curtain on its magic act to see if it can still produce rabbits out of its hat.
Be that as it may, the stock has seen several new analyst upgrades. Goldman Sachs raised its price target to $750, while Piper Jaffray says the stock is heading to $1,000. Also Topeka Capital analyst Brian While recently raised his forecast on iPhone sales to just under 30 million while expecting 11.58 million in sales for iPads. He sees upside potential in both targets particularly because of the fact that the new iPad registered 3 million units sold during its first weekend on the market.
Avoid Becoming Microsoft and Cisco
As for me, in considering how large Apple has gotten, I am eager to see how the company can produce the level of growth that Wall Street has come to expect -- not for just this quarter, but for the next eight. I have begun to project out to 2014 because that is when the stock is expected to reach $1,000 according to Piper Jaffray. What I want to see in this quarter is that Apple understands how big it has gotten and is committed to avoid hitting the growth wall that previously concussed both tech giants in Cisco (CSCO) and Microsoft (MSFT).
Microsoft was once where Apple is today until it got too big for its own good. It soon realized that there were no more markets significant enough to sustain its revenue growth.The question is, can Apple avoid the same fate? Now that it has demonstrated its dominance in markets such as smartphones, tablets, its line of computers and laptops, it needs to prepare for what's next. Where will its next neat idea come from? What can it possibly reveal during the conference call to send its shares soaring again to new heights? The answer is the announced release date of its iTV initiative and also said to be called the iPanel -- it is time that Apple got into the home.
Bottom LineIt is hard to blame anyone for taking profits on a stock that has run-up over 50% -- especially one that continues to be a case of "too good to be true." While some investors may have indeed opted to apply the "bird in the hand" theory and cash in ahead of the company's announcement, it would not surprise me the least bit to see Apple reward investors that are still holding with a few more surprise as it did when it announced its dividend. At current levels I will be buying Apple on any signs of weakness before or after the announcement, because not only am I a connoisseur for profits, I also enjoy what is interesting.
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