JPMorgan Wednesday upgraded Apple to Overweight from Neutral, arguing the company is protected from the cold winds of a consumer downturn.
“We think that Apple’s brand and market share momentum offer meaningful buffers” despite 70-75 percent of Cupertino’s sales relying on the consumer, analyst Mark Moskowitz told investors this morning.
Acknowledging even Apple won’t come away unscathed from the current slowdown in spending, Moskowitz wrote “Apple likely has a backstop beyond the first round.”
As a result of the economic conditions, the JPMorgan analyst revised downward expectations for 2008 to $32.423 billion from $32.445 billion and projects Apple in 2009 will earn $36.98 billion, lower than the Wall Street consensus of $40.26 billion.
Moskowitz also called “overdone” Wall Street worries about how the economy will impact Apple sales. The analyst joined a number of voices that tried to reverse fear-driven sales of the stock.
In a nod to Tuesday’s announcement of a price-cut to $999 on an entry-level MacBook, he said Apple might be preparing to enter the low cost computer market, now dominated by PC makers.
While Macs are not likely to make more inroads into the enterprise, the iPhone could unlock that door, Moskowitz wrote.
“We think the iPhone could be a stepping stone to penetrate the enterprise,” he told clients.
Ed Sutherland is a veteran technology journalist who first heard of Apple when they grew on trees, Yahoo was run out of a Stanford dorm and Google was an unknown upstart. Since then, Sutherland has covered the whole technology landscape, concentrating on tracking the trends and figuring out the finances of large (and small) technology companies.
