The Associated Press has named veteran Asia-based journalist and video producer Miles Edelsten to the new position of news director for Greater China. …read more
Source: FULL ARTICLE at Fox World News
Tag Archives: Greater China
Head of Google China leaves post, to be replaced by executive from Europe
Google’s leader for its China operations, John Liu, is leaving his position as the company continues to maintain a low-key presence in the nation following heated disputes over online censorship.
Liu has “decided to pursue other opportunities,” Google said in an email on Monday. Liu had been at Google for nearly six years, and originally was head of sales for the company’s Greater China operations. In 2009, he was elevated to head of Google’s Greater China business after the departure of his predecessor, Kai-Fu Lee, a tech entrepreneur well-known in the country.
Liu worked at Google as its search business in China slowly grew to compete with the country’s largest search engine Baidu. But in 2010, Google decided it would no longer agree to China’s demands for online censorship, and initiated a partial retreat from the Chinese market.
Since then, Google’s presence in China has diminished. The company’s market share for search is at 3 percent, according to Chinese analytics site CNZZ.com. In addition, many Google services, such as Google Play, YouTube or Google Plus are either blocked or not offered in the country.
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Source: FULL ARTICLE at PCWorld
Year Of The Snake Investment Guide: Bain Capital Casts A Wide Net In China
By Russell Flannery, Forbes Staff China once again this year can boast one of the world’s best-performing economies, yet a weak stock market has made it difficult for investors to make money. To learn about where investors should look for relatively good returns, I recently talked to seasoned Asia hand Danny L. Lee, a managing director at Bain Capital Asia. The Guangzhou native moved to the U.S. as a teenager and graduated from Columbia before later finding his way back to Asia in 1997. After working at Lehman Brothers and AB, he has settled down since 2006 at Bain, where he’s helped to make some of the company’s $1 billion of investments in Asia. Greater China-related companies in its portfolio include Hong Kong-listed GA Pac, a rival of Tetra Pak, media firm Sinomedia, and Gome Electrical Appliances, one of China’s biggest electrical appliance retailers. Excerpts from the conversation follow.
Nike Shares Can Find Some Zip On Emerging Market Sales
Quick Take The global athletic footwear market was valued at $74.7 billion in 2011 and is forecast to grow at a CAGR of 1.8% during 2011-2018, according to Transparency Market Research. Nike, Adidas Group (which includes Reebok), Puma and Asics are positioned as the key players in the global athletic footwear market. Nike’s footwear sales saw an impressive CAGR of 14.2% during fiscal 2010-2012, which was followed by Adidas with a CAGR of 13.3% in its footwear sales during the same period. North America and Europe account for 44% and 24% of Nike’s footwear sales respectively. Nike is posting strong growth in these regions on account of its strong brand image and innovative product portfolio. Emerging markets and Greater China account for 18% and 11% of Nike’s footwear sales. While Chinese sales have weakened recently, we expect sales in China to return to growth over the long run as the company is actively taking steps to improve its position in China. Rising competition from local players and counterfeit products are some of the factors that present risks to Nike’s market share growth. Sports giant Nike is positioned as the leading player in the global athletic footwear market with an estimated market share of almost 20% in 2012. We believe Nike is well-positioned to grow its market share to nearly 25% in the long run on account of factors such as an above industry-average growth rate in footwear sales, a strong competitive position and rapid growth in key footwear markets.
American Eagle Outfitters Appoints Kitty Yung to EVP/President of Asia Pacific, Promotes Simon Nanke
By Business Wirevia The Motley Fool
Filed under: Investing
American Eagle Outfitters Appoints Kitty Yung to EVP/President of Asia Pacific, Promotes Simon Nankervis to SVP Americas and Global County Licensing
New Appointments Build Global Capabilities; Aligning With Strategic Vision
PITTSBURGH–(BUSINESS WIRE)– American Eagle Outfitters, Inc. (NYS: AEO) today announced the appointment of Kitty Yung to Executive Vice President/President of Asia Pacific and Simon Nankervis has been promoted to Senior Vice President, Americas and Global Country Licensing.
“Kitty and Simon are proven retail executives with extensive brand management, retail development and multi-national operations experience, each spanning over 20 years. These appointments support our global geographic and channel growth, while aligning with our strategic plan of fortifying core assets, growing North America and transforming to a global omni-channel competitor focused on delivering top-tier shareholder returns,” said CEO, Robert Hanson.
Previously, Kitty Yung was President, Asia Pacific at Guess Inc., with responsibility across the region, including China, India, South East Asia and australia/New Zealand. While at Guess Inc., she grew the business to over 200 stores in Greater China. Kitty previously held a number of leadership roles in apparel general management, supply chain and consumer goods in the Asia Pacific region. With in-depth experience and business development skills, Kitty will be instrumental in the expansion of AEO‘s brands and company-operated stores across China.
In his new role, Simon Nankervis will assume responsibility for the company’s U.S., Canada and Mexico stores, as well as real estate and country licensing. Simon has extensive management, business development and global store experience and has been the leading architect of AEO‘s successfully growing country-licensing program. Additionally, he launched AEO‘s company-owned and operated stores in Mexico. Simon is an accomplished apparel leader, having led businesses for Guess, Gap, Aldo and Tumi in his native australia after an earlier career in apparel general management and consultancy.
About American Eagle Outfitters, Inc.
American Eagle Outfitters, Inc. (NYS: AEO) is a leading global specialty retailer offering high-quality, on-trend clothing, accessories and personal care products at affordable prices under its American Eagle Outfitters® and Aerie® brands. The company operates more than 1,000 stores in North America, and ships to 81 countries worldwide through its websites. American Eagle Outfitters and Aerie merchandise also is available at approximately 55 international franchise …read more
Source: FULL ARTICLE at DailyFinance
1 Important Storyline to Watch for in Apple Earnings
By Evan Niu, CFA, The Motley Fool
Filed under: Investing
Investors are now exactly two weeks away from Apple‘s fiscal second quarter earnings release. The Mac maker’s March quarter has now closed, and now it’s up to the bean counters to do their thing before releasing the numbers to investors.
Some called last quarter the most important earnings release in years, and investors were none too happy about the figures. For the upcoming earnings report, there’s one important storyline for investors to watch for.
For the second half of March, Chinese state-owned media was running an all-out anti-Apple campaign, stemming from perceptions that the company’s warranty policies put Chinese consumers at a disadvantage to their counterparts in other parts of the world.
Cook addressed the concerns head on with an apology and some policy tweaks, but only after two weeks of sustained Apple bashing. That’s nearly one-sixth of the entire quarter, which has the potential to put a dent in Apple’s results in the region.
Source: SEC filings and conference calls. Calendar quarters shown. TTM = trailing-12-month sales.
Back in 2010, the Chinese media ran a similar campaign against Hewlett-Packard , which led to the PC giant losing roughly half of its market share in the country. HP‘s business in China has never recovered, while local rivals like Lenovo, Acer, and Asus have been more than happy to pick up the slack. Earlier in the month, Citigroup analyst Glen Yeung estimated that if Apple saw a similar fate, it could translate into revenue losses of up to $13.1 billion. The comparison was an overgeneralization, but Apple’s results could have definitely been affected to some extent by the campaign.
Apple now reports “Greater China” as a separate geographical segment, which primarily includes just direct online sales. When including its retail segment (11 stores currently in Greater China), Apple is up to $26.6 billion in trailing-12-month sales in the Middle Kingdom. Cook typically provides the total figure including retail on the conference call.
Investors should keep a close eye to see if Apple’s Greater China revenue took a hit as a result of the anti-Apple campaign.
There is a debate raging as to whether Apple remains a buy. The Motley Fool’s senior technology analyst and managing bureau chief, Eric Bleeker, is prepared to fill you in on both reasons to buy and reasons to sell Apple, and what opportunities are left for the company (and your portfolio) going forward. To get instant access to his latest thinking on Apple, simply click here now.
var FoolAnalyticsData = FoolAnalyticsData || []; …read more
Source: FULL ARTICLE at DailyFinance
East West Bancorp Announces Date for First Quarter 2013 Earnings Conference Call/Webcast
By Business Wirevia The Motley Fool
Filed under: Investing
East West Bancorp Announces Date for First Quarter 2013 Earnings Conference Call/Webcast
PASADENA, Calif.–(BUSINESS WIRE)– East West Bancorp (NAS: EWBC) will discuss first quarter 2013 earnings with the public on Thursday, April 18, 2013 at 8:30 A.M. PT/ 11:30 A.M. ET via the Company’s live quarterly earnings conference call. The public and investment community are invited to listen as management discusses first quarter results and operating developments.
Information for the conference call and replay is provided on the Investor Relations page at www.eastwestbank.com. The following dial-in information is provided for participation in the conference call: Local call within the US – (888) 317-6016; Call within Canada – (855) 669-9657; International call – (412) 317-6016.
Financial results will be released over the news wires after the market closes on Wednesday, April 17, 2013.
About East West
East West Bancorp is a publicly owned company with $22.5 billion in assets and is traded on the Nasdaq Global Select Market under the symbol “EWBC”. The Company’s wholly owned subsidiary, East West Bank, is one of the largest independent banks headquartered in California. East West is a premier bank focused exclusively on the United States and Greater China markets and operates over 120 locations worldwide, including in the United States markets of California, New York, Georgia, Massachusetts, Texas and Washington. In Greater China, East West‘s presence includes a full service branch in Hong Kong and representative offices in Beijing, Shenzhen and Taipei. Through a wholly-owned subsidiary bank, East West‘s presence in Greater China also includes full service branches in Shanghai and Shantou and a representative office in Guangzhou. For more information on East West Bancorp, visit the Company’s website at www.eastwestbank.com.
East West Bancorp
Irene Oh
Chief Financial Officer
626-768-6360
KEYWORDS: United States North America California
INDUSTRY KEYWORDS:
The article East West Bancorp Announces Date for First Quarter 2013 Earnings Conference Call/Webcast originally appeared on Fool.com.
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Copyright © 1995 – 2013 The Motley Fool, LLC. All rights …read more
Source: FULL ARTICLE at DailyFinance
Apple's China Snafu: Epic Fail, or No Big Deal?
By Adam Levine-Weinberg, The Motley Fool
Filed under: Investing
Apple CEO Tim Cook recently issued an apology to Chinese consumers after state-run media outlets (most notably China Central Television) subjected the iPhone maker to withering criticism about its warranty policies in China. The controversy centered around Apple’s policy of repairing broken products rather than replacing them, as Apple does in many other markets. Media outlets claimed that Apple was therefore taking advantage of Chinese consumers, and Apple was accused of “unparalleled arrogance.” In his apology to Chinese customers, Cook vowed to improve customer service and reiterated the company’s concern for customer satisfaction.
China is a very important market for Apple. “Greater China,” which includes Taiwan and Hong Kong, is Apple’s second-largest market, and revenue has been growing rapidly there. In January, Tim Cook stated that he expects China to eventually surpass the U.S. as Apple’s top market by revenue. However, if the recent media campaign against Apple gives rise to a full-blown consumer backlash against the company, it could severely disrupt Apple’s growth trajectory there. Fortunately, I believe that Chinese consumers are by and large savvy enough to see through this “scandal,” which has been completely manufactured by the state-run media. Moreover, the media appear to be toning down their rhetoric in light of Cook’s apology.
How big is the risk?
On Monday morning, analyst Glen Yeung of Citigroup (a prominent Apple bear on Wall Street) compared Apple’s recent troubles in China to a similar campaign three years ago that targeted Hewlett-Packard . In that case, numerous consumers complained of overheating problems in their HP laptops. While HP offered extended warranties for some of the affected models in China, it was offering superior warranties in the U.S. This provoked complaints of discrimination in the media. According to Yeung, HP lost 42% of its market share in China in the 12 months following this fiasco. Yeung suggested that a similar backlash against Apple (if it materializes) could knock as much as $3.62 off Apple’s EPS.
Is the risk real?
However, many Chinese consumers seem to be taking a skeptical view of the media’s criticism of Apple. Numerous (Western) news reports have quoted Chinese citizens who believe that state-run media outlets are criticizing Apple in order to divert attention from the government‘s failings. This viewpoint was supported by the revelation that various celebrities had been recruited to criticize the company on Weibo, a Chinese microblogging site. Others in China speculated that CCTV may have been trying to extort ad revenue from Apple. Many citizens also pointed to much more serious consumer rights violations by state monopolies that are ignored by the state-run media.
By Tuesday, Chinese media seemed to be ending their attack on Apple, praising the company for its quick apology and its promise to improve its warranty policies. Media outlets rightly noted that Apple is incredibly customer-friendly compared to other American companies operating in China (not to mention Chinese-owned companies).
Catastrophe averted — …read more
Source: FULL ARTICLE at DailyFinance
Why Apple Initially Rallied Despite a Goldman Cut
By Evan Niu, CFA, The Motley Fool
Filed under: Investing
Here’s something you don’t see everyday: Apple shares initially rallied today despite analyst pessimism, though they ultimately gave up most of those gains. In recent times, the slightest inkling of analyst skepticism has been enough to trigger relentless selling, yet today Apple bucked that trend even after Goldman Sachs trimmed its models for the Mac maker.
No conviction
Analyst Bill Shope has taken Apple off of Goldman’s Conviction Buy list, although Apple is still a “buy” in his book. Shope also knocked down his price target on the Mac maker from $660 to $575. Apple wasn’t alone, as Shope has become negative on the broader tech sector, in part due to deteriorating conditions in the PC market.
Schope downgraded Hewlett-Packard from “sell” to “neutral” on the belief that shares have gotten frothy. HP had doubled from its November lows on investor hopes that the turnaround is progressing swimmingly, but Schope has pegged just a $16 price target on the PC giant.
Apple needs upcoming products to reinvigorate momentum, and Schope doesn’t believe the recent upgrades are driving market share gains as previously expected. The analyst acknowledges that Apple’s business model makes its cash flows “far more resilient,” but is still becoming less optimistic.
The downgrade is peculiar for a number of reasons. Just one and a half months ago, Goldman went to bat for Apple after Tim Cook spoke at the investment bank’s Technology and Internet Conference. Schope came out with some bullish comments, reiterating its Conviction Buy rating and $660 price target right before Valentine’s Day.
A couple weeks later, Goldman dubbed Apple the most undervalued stock within its coverage universe, based on prices and price targets at the time. How much can change in less than two months? Evidently, conviction doesn’t go a long way at Goldman.
A Chinese change of heart
Instead of focusing on the Goldman trim, investors are being encouraged today by reports that Cook’s apology to Chinese consumers has immediately begun paying dividends.
Over the past couple weeks, state-controlled media outlets in China have embarked upon a smear campaign, bashing Apple’s warranty and repair policies and (inaccurately) alleging that Apple’s policies put Chinese consumers at a service disadvantage relative to their U.S. counterparts.
The Chinese government has launched smear campaigns in the past against foreign companies, and Citigroup analyst Glen Yeung used HP as a proxy to estimate how much damage Apple could be facing. Back in 2010, China undermined HP in favor of local PC vendors, and HP ended up losing roughly half of their PC market share. By the same rationale, if Apple were to lose half of its China market, Yeung estimated that could amount to $13.1 billion in lost revenue.
That estimate made for some gloomy headlines yesterday that contributed to Apple’s 3% sell-off, but ultimately the figure is an incredibly broad overgeneralization. Apple’s trailing-12-month “Greater China” revenue (including retail) is currently $26.6 billion, so simply cutting that …read more
Source: FULL ARTICLE at DailyFinance
Alibaba Group and MasterCard Sign Memorandum of Understanding to Enhance e-Commerce Environment
By Business Wirevia The Motley Fool
Filed under: Investing
Alibaba Group and MasterCard Sign Memorandum of Understanding to Enhance e-Commerce Environment
HANGZHOU, China–(BUSINESS WIRE)– Alibaba Group, China‘s largest e-Commerce company, and MasterCard have signed a Memorandum of Understanding (MOU) to explore future collaboration in the area of e-Commerce. The MOU aims to forge joint efforts to establish an enhanced e-Commerce environment to benefit consumers and small businesses within and outside China. The two parties have also agreed to jointly address issues of common interests, including a strong mutual commitment to help combat intellectual property infringement.
As leaders in their respective industries, both companies believe that innovation and collaboration are the drivers of development in e-Commerce, and are committed to fostering an enhanced e-Commerce environment that provides a safe and efficient payment experience for users of Alibaba Group‘s platforms such as AliExpress and its affiliate Alipay. Both parties have agreed to cooperate on innovations including cross-border payments, acceptance, security and risk management as well as with MasterPass, the MasterCard digital service that allows consumers to use any payment card or enabled device to discover enhanced shopping experiences.
“MasterCard and Alibaba Group have fostered a strong collaboration in the area of e-Commerce in the past years, which includes integration of Alipay into the global payment solution of DataCash, joint promotions with AliExpress, as well as efforts in building an anti-piracy mechanism. This MOU is another significant step in the joint effort to drive the innovation and development of e-Commerce in China. We are looking forward to seeing fruitful results from these collaborations,” said Ling Hai, division president of Greater China, MasterCard.
“We are delighted to continue our collaboration with MasterCard and take it to a deeper level. Alibaba Group and its affiliate Alipay will seek to work with MasterCard on a number of innovative services in order to provide an enhanced shopping experience to consumers as well as a better online business environment to small businesses in and outside China,” said Lucy Peng, CEO of Alibaba Small and Micro Financial Services Group.
About MasterCard
MasterCard
(NYS: MA) , www.mastercard.com,is a technology company in the global payments industry. We operate the world’s fastest payments processing network, connecting consumers, financial institutions, merchants, governments and businesses in more than 210 countries and territories. MasterCard’s products …read more
Source: FULL ARTICLE at DailyFinance
China's Austerity Starves a Gifting Economy
It is hardly a coincidence that the explosive growth of China’s luxury retail industry coincided with a government-directed stimulus of 4 trillion RMB ($586 million) in 2009 to fund massive infrastructure projects. Well known luxury brands such as Richemond, the owner of Cartier; Swatch Group, the owner of Omega; LVMH, the owner of LV brands; and PPR, the owner of Gucci and Bottega Veneta, have benefitted handsomely from the stimulus, witnessing 20-30% sales growth year over year in Greater China for the last 4 years. …read more
Source: FULL ARTICLE at Forbes Latest
Apple's China Syndrome: iPhone vs. the World
By Dan Radovsky, The Motley Fool
Filed under: Investing
Let’s face it, Apple‘s iPhone, though a wonderful device, is seen globally as a high-end smartphone, one that many relish as not only a do-almost-everything handset, but also as a status symbol.
But, as much less expensive Android-driven phones become available in those parts of the world where price is definitely important, and status means less than putting food on the table, paying retail for an iPhone is out of the question.
Greater China (the mainland, Hong Kong, and Taiwan) is Apple’s second largest market outside the United States, with $6.83 million from sales during its last fiscal quarter. But the iPhone fell two notches — to sixth place — in smartphone sales during the third quarter of 2012, according to research firm IDC. Samsung and Lenovo, were No. 1 and No. 2, respectively, ZTE was No. 4, and Huawei was No. 5.
The threat to iPhone growth in China, however, comes from companies one may never have heard of in the U.S. Coolpad, for example, is the smartphone maker that jumped up three spots to become the third best-selling smartphone brand in China during that time frame.
But the real danger for Apple in China and other emerging markets comes from companies like MediaTek, the Taiwanese company behind those companies that have been taking China‘s smartphone market share away from Apple. MediaTek is the company that has helped those other companies produce smartphones at prices Chinese consumers just can’t refuse.
MediaTek makes what’s called a “turnkey solution” to the problem of manufacturing inexpensive smartphones. It puts together the chipsets, the Android operating system, packages all that with instructions on how to build the phone, and provides technical support for those companies needing it. Why pay for the research and development of a smartphone when someone has already done it?
MediaTek’s turnkey systems have become so popular that, within 18 months of putting its first chipset in a Lenovo phone in 2011, its chipsets have taken 50% of China‘s smartphone market, analysts told the New York Times.
Spreadtrum Communications is a Chinese company that is also in the turnkey smartphone chipset business. It expects to ship between 80 million and 100 million of its smartphone chipsets in 2013, platforms that will end up in markets where consumers are just now moving up from feature phones to smartphones.
“To date,” says IDC, “much of the world’s smartphone shipments were a direct result of demand in mature economies such as the U.S.”
But that is definitely changing. The growing middle classes in China, Brazil, and India are ready to buy smartphones. China, especially, says IDC, “which supplanted the U.S. last year as the global leader in smartphone shipments, is at the forefront of this shift.”
Even the young tech-conscious consumers of the world have to live within their economic realities. Zhang Ying is a 31-year-old Shanghai resident who wants the latest tech gadgets, but can’t pay a premium for it. He bought a pirated version of an …read more
Source: FULL ARTICLE at DailyFinance
NIKE, Inc. Reports Fiscal 2013 Third Quarter Results
By Business Wirevia The Motley Fool
Filed under: Investing
NIKE, Inc. Reports Fiscal 2013 Third Quarter Results
- Revenues from continuing operations up 9 percent to $6.2 billion, up 10 percent excluding currency changes
- Diluted earnings per share from continuing operations up 20 percent to $0.73
- Worldwide futures orders up 6 percent, 7 percent growth excluding currency changes
- Inventories up 4 percent
BEAVERTON, Ore.–(BUSINESS WIRE)– NIKE, Inc. (NYS: NKE) today reported financial results for its fiscal 2013 third quarter ended February 28, 2013. For continuing operations, strong demand for NIKE, Inc. brands propelled double-digit revenue growth on a currency neutral basis, and diluted earnings per share grew faster than revenue due to gross margin expansion, a lower tax rate and a lower average share count.
“Our team delivered strong results in Q3. We did it with a relentless flow of innovation into our key categories,” said Mark Parker, President and CEO of NIKE, Inc. “Given the diversity of our portfolio, we’re able to capture big opportunities that drive sustainable, profitable growth. At the same time we continue to invest in new ways to enhance athletic performance, build strong consumer communities, and improve how we design and manufacture our products. That’s how we increase our potential and drive shareholder value.”*
Third Quarter Continuing Operations Income Statement Review
-
Revenues
for NIKE, Inc. increased 9 percent to $6.2 billion, up 10 percent on a currency-neutral basis. Excluding the impact of changes in foreign currency, NIKE Brand revenues rose 10 percent, with growth in all geographies except Greater China and Japan and in all key categories except Sportswear and Action Sports. Revenues for Other Businesses increased 9 percent as growth at Converse and NIKE Golf more than offset lower revenues at Hurley. -
Gross margin
increased 30 basis points to 44.2 …read more
Source: FULL ARTICLE at DailyFinance
Teradyne Presents Innovative Solutions for the Low Cost China Market at SEMICON China 2013
By Business Wirevia The Motley Fool
Filed under: Investing
Teradyne Presents Innovative Solutions for the Low Cost China Market at SEMICON China 2013
NORTH READING, Mass.–(BUSINESS WIRE)– Teradyne, Inc. (NYS: TER) will present, to a growing Chinese market, focused low-cost ATE solutions in booth #3121 at SEMICON China held in Shanghai on March 19-21. Teradyne will display and perform product demonstrations on the ETS-88, the J750Ex and the Magnum test cell.
“Teradyne has been supporting the Greater China semiconductor industry since 1978 and currently has over 2,800 systems installed in the region,” said Houken Tseng, Teradyne Greater China Field Operations manager. “Teradyne has one of the strongest product portfolios in the semiconductor test industry, spanning the entire range of SOC test needs from logic, RF, analog, power, mixed signal and memory technologies, and reliably delivers performance and throughput with low cost-of-test for the broad range of semiconductor devices.”
The ETS-88™ is an innovative high performance multisite production test solution designed to test a wide variety of high volume commodity and precision devices including LDOs, PWMs, Battery Chargers, Hot Swap Controllers, Gate Drivers, Power Switches, Op-Amps, and Audio Amps (including Class D).
The J750Ex provides highly economical, parallel test solutions for high-performance microcontrollers, consumer SoC devices and digital wafer sort applications. Teradyne’s J750 test system, first introduced in 1998, is one of the most successful platforms in ATE history. With an installed base of over 4,000 systems including over 1,000 systems installed at OSATs, the J750 platform is the most widely available ATE for low cost SoC testing.
Magnum is a highly efficient, production test solution that increases throughput and significantly reduces test time making it ideal for low cost wafer test. The Magnum test cell solution includes the Magnum test system, a Semics OPUS-3 Prober and a Reid Ashman Manipulator. It delivers maximum parallel test and operational efficiency for typical digital, DC and analog tests performed on cost-sensitive SoC applications such as touchscreen controllers. In addition, the Magnum product line is a leader in providing low cost-of-test for production and engineering memory requirements.
For more information, visit Teradyne in Booth #3121 at SEMICON China or go to www.teradyne.com.
About Teradyne
Teradyne (NYS: TER) is a leading supplier of Automatic Test Equipment used to test semiconductors, wireless …read more
Source: FULL ARTICLE at DailyFinance
3 Votes of Confidence for Apple
By Evan Niu, CFA, The Motley Fool
Filed under: Investing
Once upon a time, Apple was the darling of Wall Street and analysts had nothing but kind words to say about the Mac maker’s prospects. These days, analyst sentiment continues to sour and downgrades and related sell-offs are the norm. Just this week, one analyst slashed his price target from $800 to just $360, a 55% reduction.
That’s why news of three different analysts expressing confidence in Apple’s business is something of a breath of fresh air.
First to speak
Credit Suisse analyst Kulbinder Garcha is out today reiterating an outperform rating on Apple shares, while keeping his $600 price target. The analyst recently spoke with Apple CFO Peter Oppenheimer, like other analysts in recent months, and Garcha feels more confident now that Apple has numerous long-term growth catalysts. One of them is that Apple continues to see unprecedented opportunity in China. Garcha says that Apple is now up to $23 billion in sales even though there are only 11 retail stores in the region.
My figures actually show Greater China revenue at $26.6 billion including retail over the past four quarters and $25.3 billion excluding retail, which implies that retail expansion is indeed still a small part of China sales — and therefore a huge opportunity for growth. I’ve also created a special bonus report all about Apple’s China opportunity, including retail, in The Motley Fool’s Apple service.
The company is opening retail stores in 15 new countries this year and increasing its presence in Brazil and Russia.
The analyst believes that the perception of smartphone saturation on the high end is somewhat overdone. It remains true that unit growth will be greater on the low end, but Apple can still grow on the high end through increased market share and low user churn due to iOS platform stickiness.
Garcha says there’s still no news on the cash front, but estimates that Apple has $26 billion of excess domestic cash, saying it could easily afford to increase dividend yield up to 4% this year. Apple has $42.9 billion in domestic cash right now, which implies that it only needs about $17 billion for domestic operations.
Sooner rather than later
Mizuho Securities analyst Abhey Lamba is also standing pat with a buy rating and $575 price target, in part based on the expectation that this year’s iPhone will come earlier than in 2012. The next model could launch in June or July, leading to an expected sequential downtick as consumers delay purchases in anticipation of new models.
iPhone units in the current quarter are estimated in the 35 million to 40 million range, which is in line with Street expectations, while June quarter shipments will depend on when new models are released. Lamba is among other analysts that think an affordable iPhone is still in the pipeline for this year, but a larger iPhone will have to wait until 2014.
The analyst expects a cash-related announcement over …read more
Source: FULL ARTICLE at DailyFinance