PJ ups Apple target to $103, expects split soon

Based on this week's announcements at Macworld and expectations for continued market share gains for both Mac and iPod over the next two years, research and investment firm PiperJaffray today raised its target price on shares of Apple Computer from $80 to $103.

Although there has been growing chatter that Apple is becoming a new representation of an "Internet bubble stock," analyst Gene Munster begs to differ. "We believe this label is unfair," the analyst wrote in a research note released to clients on Friday morning.

The analyst believes 2006 is poised to be the year of both iPod growth and, more importantly, Mac market share gains, which will significantly drive earnings upward.

In addition to new iPods and Intel-based Macs, the Munster expects Apple to look to new product categories by year's end, possibly including mobile phones, other consumer electronics entertainment devices.

Looking beyond this year, the analyst sees the Apple story continuing to gain momentum in 2007, as the company is addressing the fastest growing market segments that touch the digital consumer.

"Given Apple's current trajectory, legitimate competition in these markets in 2007 is unlikely," he said. "While seemingly aggressive, we expect Apple can outperform the competition for multiple years, assuming the current pace of innovation continues."

While not necessarily a catalyst for Apple's business, PiperJaffray said another Apple stock split should deliver a mild positive for Apple shares. The firm notes that Apple shares last split in the $80 range, and says it expects a 2-for-1 split will be announced by Apple soon.

PiperJaffray maintains an "Outperform" rating on Apple shares.

22 Comments

cubert 726 comments · 19 Years

About 18 years ago

2006 is the year the Macintosh platform finally gets some respect from the general public - mark my words!

melgross 33598 comments · 20 Years

Interesting that he mentions a split. I've been getting a bunch of questions about that.

If anyone is thinking to buy, don't wait for a split!

But, at least, the analysts are coming around to my own prediction of a $100 share price.

hmurchison 11823 comments · 23 Years

Apple is severely overpriced.

SpamSandwich 32917 comments · 19 Years

"...In addition to new iPods and Intel-based Macs, the Munster expects Apple to look..."

Heh... "The Munster"?

I'd be very happy to see a nice clean growth curve on Apple's part.

Hey, Mel... just let us know when you're thinking of selling...if ever.

vikingstad 5 comments · 19 Years

Overpriced? I don't think so...

Just consider this little fact. About 40 million iPods have been sold so far, in about 4 years... So what does that mean? Well, Sony sold about 200-300 million Walkmans during the 80's and 90's. The world economy today is a lot better than back then, meaning there is more buying power and more consumers that can afford it (a bigger middle class, world wide), so I expect the numbers of iPods to get to that number, AT LEAST.

And that's just counting the iPods. If the sales of Intel Macs really take off, and we get a new home entertainment product that gets the popularity of the iPod, then well aapl doesn't seem overpriced to me. Yes, it has about the same marketcap as Dell right now, but the potential for Apple is a lot larger than Dell's, in the long run.

Just my 2 cent...