American Technology Research analyst Shaw Wu has upgraded his assessment on Apple from Hold to Buy, citing "strong product momentum and strong competitive advantage".
He has also raised his target price on the stock to $63. In a note to clients obtained by this reporter, he reveals: "We believe Apple is experiencing strong product momentum and that the company's already strong competitive advantage with its integrated stack of hardware, software and service has strengthened."
Intel move to boost Mac sales
"Despite the transition to Intel processors from PowerPC, Mac sales continue to be very strong and in the last quarter, actually accelerated, up 48 per cent year on year," Wu observed.
"A Mac with 'Intel Inside' may persuade more users than before to consider a Mac," he added.
On previous bullish iPod sales predictions, he said: "We believe expectations have been reset, particularly on the iPod side with unit forecasts now at more realistic levels."
Looking forward, the analyst expects Apple to grow at "30 per cent or higher over the next 12-months."
Tech leadership offers new opportunity
Wu waxes lyrical on Apple's ability to lead the market: "In our view, this is the first time in a long time where leadership in consumer electronics is being driven by an American company," he said, baldly stating the possibility that Apple could exploit its hard-won advantages to deliver new products, including mobile phones, flat panel TVs, and home entertainment servers.
The analyst minimises the threat from Apple's competitors in the music markets. Despite years of concern at competitors: "We believe Apple is positioned to retain a dominant position," he said
The company's "whole widget" approach to product and service design is cited as a key strength, within a wider industry that remains "fragmented". Sony remains the biggest threat, in Wu's analysis.
Apple's play for the mobile market also takes centre stage in this assessment: "We believe Apple is studying and working on a business plan to attack the mobile phone space similar to its strategy in music", Wu said.
He added: "We believe it will likely design its own hardware and software and partner with a third-party carrier for an MVNO (Mobile Virtual Network Operator) service."