With a dismal start for the Apple iPhone new releases, the word around town is that CEO Tim Cook and his fellow lieutenants at Cupertino have merely tried to resell what’s already out there – the iPhone 5. To put it in another way, there’s nothing new there. The markets have deleted almost $30 billion from shares of the Cupertino-firm after several key banks including Merrill Lynch, Citigroup, and Credit Suisse had Apple stock downgraded.
Scott Craig and Samuel Park, research analysts at Merrill Llynchi wrote in a note, “We downgrade to Neutral on (1) lack of a “lower-end” iPhone and price points that will be too high to increase penetration in emerging markets (2) no China Mobile agreement, (3) a likely less than expected impact from China Mobile, when/if a partnership is announced — higher than expected pricing, no lower-end iPhone, (4) another “evolutionary but not revolutionary” iPhone product launch, and (5) risk to near term gross margin estimates, given typical lower gross margin on new iPhones (in this case both 5C and 5S, as opposed to only one new launch).”
Seabreeze Partners Management’s Doug Kass wrote, "Just how far behind is Apple trying to fall? I do not get Tuesday's release and product launches. Something is just wrong," CNBC reported.
Meanwhile, Analyst at Credit Suisse, Kulbinder Garcha, said in a statement, "The iPhone 5C, we are kind of concerned that it's being priced at $550 unsubsidized at the least in all markets of the world,”
"That's going to compete with the best and newest offerings from let's say a Samsung, who has bigger screens and better processors and cameras. What all this means is it really impacts the earnings growth," he added in an online report by CNBC.
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