Frager Factor

Saturday, July 19, 2014

(AAPL) Apple Is Back on Track to $200 Price Target Reset by Frager Factor

With the IBM deal to penetrate the enterprise, the opening of new previously untapped markets like Viet Nam as phone saturation hits home, Carplay coming in 24 Million Connected Vehicles across all brands and models, the wearables, the iPhone 6 and more progress fighting the cable companies (whose survival depends on Apple losing like Aereo did, but Apple won't), Tim Cook is on the mend and the stock is back on track for my original $1000 target, meaning $200 adjusted for recent split. All while Samsung is weakening and losing the game when people realize Apple is a platform and with Samsung they are buying just one device. 

“First they ignore you, then they laugh at you, then they fight you, then you win.”

From Frager Factor March 2012-
When we first forecast the stock at $1000, on December 25th,2011, the stock stood at $410, and now just 59 days later it's gained 25% at $545, with mainstream analysts like UBS, betting it at $710 by the end of this year on iPhone strength.

That's all before the new products roll out including game-changing Apple TV. Apple TV in its current form is already sold out at 98% of Apple Stores.
It sounds crazy that a stock could reach $1000. But then they said I was crazy when I was first to predict $300 but look at my explanations why and how. They have all come to be as if I had given you a road map.

I think it could be more like $10K - when you consider the implications of Apple taking home the set top box prize. Look at what they gain by taking out 99% of the traditional functionality of domains, cable and search, not to mention changing the whole way human beings interact with TV and the web.

Gone will be typing in commands. Simple gestures or words to Siri will change your channels, find the website you want, a favorite video on YouTube and much much more.

iCloud will command it all, connecting and synchronizing the enterprise with any where, any time, any device access to a single view of all applications and documents across multiple platforms. Which is why we see is over a hundred million accounts (one fifth of all those possible), now on free trial, soon paying a minimum of $99 a year.

And it'll take only a couple of months of free service till people are totally dependent on it - and likewise on Apple. This is why, as hard a Google and Amazon are working to gain traction on the voice recognition component, Apple has The Platform and all of its customers. No way you can catch up.

Said one analyst, "Here’s a $5 billion market opportunity as demand increases for voice engine products such as Apple’s Siri voice engine, which is powered in part by Nuance technology. Every mobile and consumer electronics company on the planet is looking for ways to integrate natural, conversational voice interactions into their mobile products, applications, and services.”

From a recent Steve Lohr NYT article titled, "At Apple, the platform is the engine of growth:"

"Size is the enemy of growth. It is one of the unwritten laws of business, a matter of simple percentages. After all, when a company has $1 billion in yearly sales, an extra $1 billion doubles its size. Add $1 billion in new business to a $10 billion-a-year company, and it amounts to just 10 percent growth. The size-growth tradeoff seems inevitable, an inescapable force like gravity. Try telling that to Apple, the corporate giant that two weeks ago reported a 71 percent jump in quarterly sales. Apple generates revenue at the rate of $100 billion a year.


The software and services that work on Apple’s hit products are accelerating its extraordinary expansion. Apple provides the underlying technology and marketplace: iTunes software and the iTunes Store for managing, downloading and buying music and media; iPhone and iPad software for creating applications; and the App Store for sampling and buying them.

"The more people buy iPhones and iPads, the more software developers and media companies want to write applications for them, as various as games and digital magazines. And consumers are more likely to buy iPhones and iPads when more entertainment and information applications are available on them. The combination of hardware, software and services is what corporate executives, economists and analysts call a platform. Successful technology platforms sustain and reinforce growth. And this self-reinforcing cycle is known as a network effect. It helps the platform owner and raises a barrier to competitors."

If Apple had previously been using a stealth bomber to destroy other industries that were still fighting with swords, this time Jobs, even while resting in peace, is going Nuclear - by sending a marketing mushroom cloud that will turn search, domain, and operating systems players, assumed to be invincible, to ashes. His legacy is an explosive message to his critics, and to all who tried to thwart him: "I told you - it's all about smart ideas and the value they create."

Smart ideas win. And it doesn't hurt that they're seasoned with a little competitive vitriol.

I can assure you that when all these industries claim to have been caught blindsided by him, they had every opportunity not to. They should go back and read this blog, because all the trade secrets have been clearly laid out here. Take it from my Bell Labs colleague who just wrote a Forbes article about what both of us know that no one knows - because of the front row seat we had on the future, fifteen years before everyone else.Then again, Job's biographer did leave some juicy stuff out, maybe for this reason.

The wired and wireless world is hyper-connected, and just as Jobs always wanted and predicted, the marketplace is ravenous for the smartest idea flawlessly delivered. iPads, Siri, effortless integration of visual and auditory product no matter what its source. So long, keyboards. Take note, Google and Microsoft and other lumbering giants - you're in the Triassic Age and the meteor is minutes from impact.

Photo: Just another day, another line at the Apple store via Wantchina Times

About The Author: Owen Frager is an Internet marketing expert ready to help take your company to the next level.

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