The downside of the iPhone’s gargantuan success as a money maker for Apple is that it can also have an “outsized impact” on Apple profits. The iPhone contributes 49.2 percent of Apple stock value, one analyst warns. Wall Street also said the iPad has replaced the iPod as the tech giant’s halo product, buoying sales of other Apple products. Even so, at least one analyst thinks that Apple could go as high as $540 a share.
The iPad now comprises 12.2 percent of Apple’s stock price, according to Needham & Co.’s Charlie Wolf. The analyst told investors he raised Apple’s target share price to $540, up from $450 largely on the “assumption that the device should capture a materially larger share of the tablet market than we previously forecast.”
Wolf substituted the iPad for the iPod as the Apple ‘halo’ device to sell Macs. Traditionally the Cupertino, Calif. company has used the iPod to pull consumers in, who often then buy a Mac. Mac sales now account for 11.5 percent of Apple stock value while the growth of the App Store culture pushed iTunes importance to 5.1 percent of the stock’s value.
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.
