As Apple's recently filed financial restatements confirmed increasing Mac sales, American Technology Research analyst Shaw Wu believes there's more Apple opportunity ahead.
It's the so-called 'iPhone' that will drive sales even further north, the analyst believes. In a note to clients received by Macworld, he writes: "Both existing (60 million) users and new users will be attracted to Apple's legendary ease of use and industrial design with its version of an everyday mobile phone."
Despite jitters over Apple's share options scandal, Wu sees the stock as one to buy and has set a $99 target price, with some of the strongest growth prospects around.
The analyst warns that existing consensus estimates for the firm's fortunes may emerge as 'conservative' figures. He cites strong product momentum in 2007, including Mac OS X 10.5 (Leopard), iTV ushering in a new product category, new iPod features including widescreens and Bluetooth, and mobile phones.
Wu estimates the company will achieve $28.1 billion in revenue in 2008, with Mac growth of 23 per cent to 8.8 million units, iPod growth of 9 per cent to 47.3 million units, and a mobile phone contribution of $326 million, up from $100 million in 2007.
Looking at the $84 million charge faced by Apple as a result of its financial restatements following options grant problems, Wu describes the charge as "very minor", and compares it to the charges faced by other companies guilty of options mismanagement – $900 million by Juniper and as much as $1.5 billion by Broadcom.
Looking at Mac users swinging across from Windows, Wu writes: "While undoubtedly Apple is attracting new users to the Mac platform with growth rates that are three times the market, we are concerned that investor expectations may have been higher."