A slower decline in iPad pricing will have little impact on Apple’s (NASDAQ:AAPL) stock, as we estimate iPad to constitute only around 8% of Apple’s stock. Trefis members have created forecasts for two key drivers of Apple’s stock over the last week: (1) iPad Pricing (2) iPad Gross Profit Margin.
The member forecasts suggest that iPad Pricing will trend above the estimates of the in-house team of analysts at Trefis, while iPad Gross Profit Margin will trend in-line. Apple’s iPad competes with Amazon’s (NASDAQ:AMZN) Kindle, Sony’s (NYSE:SNE) e-reader, and Barnes & Noble’s (NYSE:BKS) Nook. We currently have a Trefis price estimate of $337 for Apple’s stock, about 35% above the current market price of $250.
Below are charts showing recent estimates created by Trefis members for the two drivers in detail.
1. iPad Pricing
The average of Trefis member forecasts for iPad Pricing indicate a decrease from $604 in 2010 to $501 by 2016, compared to the baseline Trefis estimate of a decrease from $600 in 2010 to $441 by the end of the Trefis forecast period. The member estimates imply an upside of 1% to the Trefis price estimate for Apple’s stock.
Disagree? You can drag the forecast trend-line above to express your own view, and see the sensitivity of Apple’s stock to iPad Pricing.
Our complete analysis for iPad Pricing is here.
The average of Trefis member forecasts for iPad Gross Profit Margin indicate a decrease from 54% in 2010 to 39% by 2016, compared to the baseline Trefis estimate of a decrease from 55% in 2010 to 40% by the end of the Trefis forecast period. The member estimates imply a small downside to the Trefis price estimate for Apple’s stock.
Disagree? You can drag the forecast trend-line above to express your own view, and see the sensitivity of Apple’s stock to iPad Gross Profit Margin.
