Investors should buy Apple aggressively, according to American Technology Research senior analyst Shaw Wu. The reason for Wu’s bullishness is the iPhone, and the analyst is confident that the device will be a success story for Apple.
Wu makes a number of observations about the iPhone in a note to clients obtained by MacNN.
According to Wu, Apple is set to receive a 'bounty' for each customer who signs up for an iPhone contract at one of its stores. Wu believes that agreement could translate to a monthly fee of $5-10 per user.
Wu also believes Vodafone will be Apple's carrier of choice in Europe. He notes that Vodafone has 200 million subscribers, broad country coverage and investment in advanced technologies.
The high price of the iPhone is one factor that has raised concerns as to whether Apple will be able to meet its target of 10 million iPhone sales by the end of 2008. A solution may be in the pipeline – Wu says his sources indicate that a rebate or carrier subsidy for iPhone of $50-150 is being considered.
Ignore the rumours
Wu also advises investors to ignore the current rumours that the launch of the iPhone will be delayed. He writes: "While we cannot confirm at this point, we would view any weakness on such rumors as a buying opportunity as longer term, regardless of whether iPhone launches on time or a month late, it is irrelevant to Apple's ability to execute longer term and their strategy for penetrating the handset market."
"We believe there is substantial upside to Apple and longer term investors will be rewarded in owning one of the highest quality, rapidly growing, innovative large cap companies," Wu said.
Reports had appeared claiming that some iPhone suppliers have been told that the iPhone may not be available until the end of June. However an Apple spokesperson has confirmed that Apple's position on the launch date hadn't changed since it announced on 12th April: "iPhone has already passed several of its required certification tests and is on schedule to ship in late June as planned."