Strong shuffle demand could help Apple outshine iPod estimates

Posted:
in iPod + iTunes + AppleTV edited January 2014
An analyst for PiperJaffray said Wednesday strong sales of Apple Computer's new iPod shuffle digital music player could make his current quarter iPod unit estimate appear low.



"While Apple has maintained a robust inventory, our checks with 40 big-box retailers and online vendors show that demand is outweighing supply in these channels," analyst Gene Munster wrote in a research note, referring to the new $79 flash player.



Echoing a recent AppleInsider report, Munster noted that both Amazon.com and Target.com are sold out of the player and one Amazon.com affiliate, BlueProton, is selling the player at a $30 premium.



Similarly, the analyst also drew attention to the shuffle being the only iPod not shipping within 24 hours from Apple's online store.



"That said, our checks with 20 Apple retail stores show that 100 percent have over 50 shuffles available heading into the busiest shopping week of the year," he wrote. "In other words, once again, Apple seems to be keeping the inventory of its hot new items within its direct channel until it can ramp up enough supply to cover both direct and indirect."



Also in his note Wednesday, Munster said checks with big-box retailers show that store clerks are suggesting iPods significantly more than other brands, and added that they are making those recommendations more frequently than they used to.



"When asked to suggest an MP3 player for less than $200, 70 percent suggested an iPod model," he wrote. "This figure is up from 52 percent in Jun-05 and 38 percent in Nov-05."



While Munster acknowledges that it's "way too early to make a call" on Apple's December quare iPod results, his analysis last week of the first month of NPD data (October) for the quarter suggested the Cupertino, Calif.-based company would sell between 14 and 15 million units.



"Since the shuffle was not released until 3 November, the player will likely have a material impact on the November and December NPD data and our current expectations could prove to be low," he explained.



Munster maintains an "Outperform" rating on shares of Apple with a price target of $99.

Comments

  • Reply 1 of 12
    how is much apple will beat expectations is important though. in the past they have blown away estimates but if they only beat this one by a million or two untits than that will not be seen as amazing.. however if they beat estimates by over three million units i think that will be seen as excelent. first post yay
  • Reply 2 of 12
    boogabooga Posts: 1,077member
    It's fascinating to see how much the press and analysts have turned around on Apple. If this had been a couple years ago, there would be huge articles about how the low-priced shuffles were going to cannibalize the more expensive models and a big sell-off on AAPL over perceived lower earnings.
  • Reply 3 of 12
    melgrossmelgross Posts: 31,507member
    Quote:
    Originally Posted by Booga


    It's fascinating to see how much the press and analysts have turned around on Apple. If this had been a couple years ago, there would be huge articles about how the low-priced shuffles were going to cannibalize the more expensive models and a big sell-off on AAPL over perceived lower earnings.



    A couple of years ago, no one could have foreseen this. Apple is maintaining a big enough price differential between the Shuffle and the lowest priced Nano to prevent one from migrating up or down.



    The people who buy the Shuffle want a small cheap player, and don't care about a screen.



    The people buying the cheapest Nano, want more memory, a screen, and greater versatility, with the connector for accessory speakers, etc.



    The two are too far apart for much cannibalism to occur.
  • Reply 4 of 12
    melgrossmelgross Posts: 31,507member
    As I'm typing this, my real time account shows Apple's price as $88.93, with an interday high, so far, of $90.00.



    I think we will see $99. I just hope that all of the expectations come true. If no phone intro is forthcoming in the next few months, the price will drop. The P/E is getting a bit high again.
  • Reply 5 of 12
    I was at Frys yesterday and they had about 2 dozen Shuffles.
  • Reply 6 of 12
    jeffdmjeffdm Posts: 12,946member
    Quote:
    Originally Posted by bdkennedy1


    I was at Frys yesterday and they had about 2 dozen Shuffles.





    Let's see some article spin something like that as having stock meaning that the demand is weak.
  • Reply 7 of 12
    Quote:
    Originally Posted by JeffDM


    Let's see some article spin something like that as having stock meaning that the demand is weak.



    to be fair, a LOT of people avoid Fry's Electronics when buying electronic gadgets. And me personally, I avoid Fry's like the plague!



    Frankly, I am surprised there is this much of a demand for the new Shuffle. My older sandisk is 1gb and I still prefer that one @ the gym then something as this shuffle. But that's just me.



    Quote:

    "When asked to suggest an MP3 player for less than $200, 70 percent suggested an iPod model,"



    ok, the problem I have with this is one time a friend of mine went to a big box store and asked about buying an MP3 player. He SPECIFICALLY asked for something that was not an ipod. The salesperson told him "all mp3 players are ipods" meaning the word ipod is becoming a generic word like "xerox". Not sure if that was a good thing or not.



    Of course, the salesperson could of been just a moron trying to sell something to my friend knowing full well he would get a higher commission for selling said ipods instead of sandisk or anything else.
  • Reply 8 of 12
    nofeernofeer Posts: 2,422member
    i bought 5 new shuffles for christmas presents., i think the look and the ads says it all, wear your music and its big enough for podcasts. i think it will be THE BOMB, the new "it"thing when my wife saw it she went nuts, she is a good barometer of consumer interest.
  • Reply 9 of 12
    melgrossmelgross Posts: 31,507member
    Quote:
    Originally Posted by mike31c


    to be fair, a LOT of people avoid Fry's Electronics when buying electronic gadgets. And me personally, I avoid Fry's like the plague!



    Frankly, I am surprised there is this much of a demand for the new Shuffle. My older sandisk is 1gb and I still prefer that one @ the gym then something as this shuffle. But that's just me.







    ok, the problem I have with this is one time a friend of mine went to a big box store and asked about buying an MP3 player. He SPECIFICALLY asked for something that was not an ipod. The salesperson told him "all mp3 players are ipods" meaning the word ipod is becoming a generic word like "xerox". Not sure if that was a good thing or not.



    Of course, the salesperson could of been just a moron trying to sell something to my friend knowing full well he would get a higher commission for selling said ipods instead of sandisk or anything else.



    He won't get a higher commission selling iPods. The complaint that stores have with Apple's products is that there is less "headroom" on their products to begin with. If anything, he will be getting a smaller commission, assuming that he gets a commission at all, as most stores are stopping that practice.
  • Reply 10 of 12
    Quote:
    Originally Posted by NOFEER


    i bought 5 new shuffles for christmas presents., i think the look and the ads says it all, wear your music and its big enough for podcasts. i think it will be THE BOMB, the new "it"thing when my wife saw it she went nuts, she is a good barometer of consumer interest.



    Any idea if they will produce the Shuffle in different colours?

    -I seems to me that a clip-on fashion item like the shuffle really could do with multiple colour options

    - the silver one looks ok, but a blue or pink or black one would be even cooler!

  • Reply 11 of 12
    nofeernofeer Posts: 2,422member
    what about acessories?? like a wall charger, or maybe a cool doc that attaches to your computer without the wires. i saw a swivel doc for the old shuffle somehere it was cool easy to swing out of the way and connects to you mac. usb
  • Reply 12 of 12
    melgrossmelgross Posts: 31,507member
    Quote:
    Originally Posted by NOFEER


    what about acessories?? like a wall charger, or maybe a cool doc that attaches to your computer without the wires. i saw a swivel doc for the old shuffle somehere it was cool easy to swing out of the way and connects to you mac. usb



    I'm waiting for the pavé diamond case.
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