Apple's Mac, iPod sales face favorable comps in early 2010

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Apple's recently concluded December quarter is expected to produce blockbuster results for the company, and that momentum is forecast to carry into early 2010 with a favorable landscape.

Domestic Mac sales for the first half of 2009 eased by 1 percent. Analyst Gene Munster with Piper Jaffray said these comparisons will give investors a buying opportunity for AAPL stock, as he expects "meaningful unit growth" for the Mac in early 2010.

Unlike the second half of 2009, when outstanding Mac sales jumped 18 percent, the first half of 2009 saw a year-over-year decline. That places Apple in a position to exceed expectations, Munster said.

"Domestic retail data from NPD carries a strong correlation with quarterly Mac sales," he said in a note to investors issued Tuesday morning. "As such, the monthly [year-over-year] growth rate is widely used as a leading indicator for Mac sales. [Year-over-year] comparable growth rates ease for Macs in [first half of 2010], and should make for strong Mac unit growth in [first half of 2010]."

Similarly, year-over-year comps for iPod sales are off 14 percent for the first half of 2010. Compare that to the second half of 2009, when the comparison to 2008 was off just 3 percent.

"We see these easing comps as a buying opportunity ahead of NPD data for the final month of the Dec. quarter on 1/18," he said, "and we reiterate our [overweight] rating ($277 price target)."

Munster 2

Apple's first fiscal quarter ended the day after Christmas, Dec. 26. In analyzing NPD data for October and November, Munster believes new the new iMac will push Apple to between 2.9 million and 3 million total sales for the three-month frame.

Data for October and November shows overall Mac sales up 21 percent year over year, carried by a 74 percent increase in desktop Mac sales. In October, the new 21.5-inch iMac was the best-selling destkop in the U.S.

iPod sales for the December quarter are predicted to be between 19 million and 20 million, which would represent an 11 percent year-overyear decline. This is representative of the continued cannibalization of the iPod line with the iPhone. Some believe Apple could have sold as many as 11 million iPhones last quarter, which would be by far the most successful quarter for the handset in its history.


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