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January 15, 2009 - Analyst roundup re Steve Jobs' health

RBC Capital analyst Mike Abramsky comments on Steve Jobs health:

CEO Jobs' unexpected leave of absence raises near-term uncertainty regarding leadership. Jobs is widely viewed as Apple's chief innovator, dealmaker, leader, deeply involved in minute decisions, inextricably tied to Apple's brand. Jobs' being sidelined for 6 months or more and unavailable day-to-day - with no clear successor - in our view raises risks to Apple's sustaining its stellar record of innovation going forward."

Abramsky cut his rating on AAPL to Underperform from Sector Perform, reducing his price target to $70 from $125.

We see a re-valuation in Apple shares towards the market multiple, on reduced earnings growth expectations and near-term uncertainty [regarding] leadership."

Yair Reiner of Oppenheimer maintains an Outperform rating, but cut his target to $120 from $135:

Given the events of the past 10 days, we’re unable to place much faith in Jobs’ anticipated return date of late June. For Jobs’ sake and Apple’s, we hope it proves true, but we’ll trust only time to tell us. Meanwhile, it’s incumbent on Apple’s board to take control of the situation.”

Gene Munster of Piper Jaffray maintains his Buy rating on AAPL with a price target of $235:

The company is led largely by [Cook], chief financial officer Peter Oppenheimer, and ten Senior Vice Presidents who share a collective track record of consistently outpacing their competitors in terms of hardware and software innovation coupled with robust product marketing and financial discipline.

We believe that during Jobs' absence, Apple's sales will be unaffected. More importantly, we believe the pace of innovation will remain solid, driven by key product-minded executives. From an operational perspective, we expect [Tim] Cook to maintain the same standard of excellence that he demands as COO.

While the iconic leadership of Steve Jobs cannot be fully replaced, we believe his core attributes as a CEO, operationally and with products, can be replicated. Cook provides the operational expertise for the company, which would serve him well as Apple's CEO. [Along with Jon Ive], we believe that Cook and the other leaders at Apple can effectively replicate the elements of Steve Jobs' leadership that have been critical to his success as CEO."

Scott Craig of Merrill Lynch maintains his Buy rating and $110 target. Craig cites his “confidence in Apple’s management team” combined with an attractive valuation and advises investors use weakness in the stock to buy.

Charles Wolf of Needham & Company maintains his Strong Buy rating and $240 target:

While it will be difficult for Apple shares to outperform with this cloud hanging over the stock, the fact that Mr. Jobs did not resign nor did the Board call for his resignation suggests that he may well be telling the truth. In short, with the stock likely trading on the prospect Mr. Jobs will never return, the news today could represent an incredible buying opportunity.”

Brian Marshal of Broadpoint AmTech raised his rating to Buy, from Neutral with a $100 price target.

The next six months are going to be basically a trial period for Tim Cook to be CEO. If that period goes well, my expectation is that Steve will pass the baton over to Tim in June and basically Steve will be his senior adviser."

January 13, 2009 - Broadpoint AmTech

Brian Marshall of Broadpoint AmTech believes that China may see the iPhone nano's initial release before the U.S.:

Obviously, the best-case scenario here would be a China launch, but we have no definitive knowledge of this and are working on identifying the locale of launch and other pertinent details."

January 1, 2009 - FBR Capital Markets

Craig Berger of Friedman, Billings, Ramsey Capital Markets says an iPhone nano is coming:

We have incremental checks into the Apple supply chain. First, we see several new Apple products coming in 1H09. Our contacts see a lower-cost version of the iPhone, possibly in mid 2Q. Apparently, Qualcomm is replacing Infineon as the baseband supplier in this device. Some call this device the 'iPhone Nano'; whatever one calls it, we believe this device is on its way."

December 30, 2008 - Piper Jaffray

Predicting product announcements for this year's Macworld has been difficult with new iPods and Macs released in the fall and the relatively new iPhone 3G. With Phil Schiller delivering the keynote, we believe it suggests there will not be any revolutionary products at this year's event.

While we believe it is unlikely that a new iPhone will be released at Macworld, we continue to expect a new model by the end of the March quarter. Specifically, we believe Apple could introduce a lower-end model that is slightly thicker due to the inclusion of a slider keyboard for students (texting) and business use (email) between $99 and $149."

December 17, 2008 - Analyst roundup re Macworld 09

Yair Reiner of Oppenheimer downgrades AAPL to Perform from Outperform:

We don’t know know why Steve Jobs has pulled out of his annual address at Macworld on January 6. Maybe he’s not feeling well, or maybe he just has nothing new to say. Whatever the reason, the unexpected announcement has underscored the greatest risk to Apple’s long-term success - its dependence on Jobs’ health and its apparent lack of a succession plan.

It’s past time for Apple to either disclose the state of his health or elaborate a viable plan for eventually transferring power. Until such time, we can no longer continue to recommend Apple as a long-term investment.”

Charles Wolf of Needham & Co.:

I think Apple wants to get away from the tyranny of MacWorld where it is forced to introduce new products on IDG's schedule, rather than its own."

Keith Bachman of BMO Capital Markets believes Apple will not be unveiling any new products at Macworld 09:

We believe that not having Mr. Jobs lead the 2009 MacWorld does suggest, consistent with our note of December 4, that this event will not be terribly meaningful. Hence, the downside in the stock for a disappointing MacWorld is probably realized near-term rather than at MacWorld."

Shaw Wu of Kaufman Bros.:

I think it's going to be very difficult when you don't have the marquee star. Not only was Apple a big exhibitor, but the keynote was a big attraction. Eliminating those things will put a lot of pressure on the show."

Gene Munster of Piper Jaffray says an iMac refresh and redesigned Mac mini may be announced at Macworld:

We're not expecting as much today as we were yesterday. The reality is, if they had something big to show, Steve Jobs would probably be showing it.

While we do not believe that this change provides any indication regarding Steve Jobs' health, we do believe that it is a sign that we are in the early stages of changing roles in Apple's management structure.

While Steve Jobs is the irreplaceable face of Apple, we believe product innovation has come from throughout the organization."

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