Apple (NASDAQ:AAPL) announced the latest version of its Mac operating system named OS X Lion. [1] Despite the 250+ new features included in this version, one of the most eye catching items is that the software price was cut drastically. The previous version OS X Leopard was available for $129 while OS X Lion version will sell for $30 when it is released next month. [2] Moreover, OS X Lion can be downloaded online from the Mac App Store while the previous versions were available in retail stores on a physical disc. We believe that these measures are aimed at pushing Mac hardware sales as well as pricing it well under Window’s 7 offering. Apple has consistently gained in the PC market, posing a threat to competitors like HP (NYSE:HPQ) and Dell (NASDAQ:DELL). If Mac’s momentum continues, its market share could increase at a faster rate in the long-term than what we expect, pushing up its stock value. The Mac division makes up 13% of our $430 price estimate for Apple stock, which is about 30% above the market price.
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