Piper Jaffray sales count: 22 iPhones, 28 Macs a day
One of the things that distinguishes Gene Munster's coverage of Apple (AAPL) from the other analysts who follow the company is that he actually leaves his office, goes into Apple stores, and counts sales.
Last week, he and his colleagues at Piper Jaffray spent a total of 25 hours visiting a sampling of Apple stores around the country — both mall outlets and flagship stores — where they recorded how many iPhones, Macs and iPods they observed being sold.
On Wednesday, he released the results of those counts — and his analysis of what they mean for Apple's fiscal Q2 results, due out on April 22.
Bottom line: Although sales are down across the board, Munster expects them to meet or — in the case of the iPhone — significantly beat the Street's expectations. In particular:
- iPhone: Munster's team counted a weighted average of 22 iPhones being sold per day — well below both July/Aug '08 (95 per day) and Nov. '08 (28). Although that suggests a 15% drop from Q1, or 3.7 million iPhones for the quarter, Munster estimates that when international sales are factored in, Apple may meet his target of 4.4. million units for the quarter. The Street is expecting 3.3 million.
- Mac: The 28 Macs that Munster's team counted is considerably above the number his model predicts, but March sales were boosted by the arrival of desktop models that weren't available in January and February. Adjusting for the difference, Munster estimates that Apple finished the quarter having sold 2.2 million Macs, up slightly from the Street's expectation of 2.1 million.
- iPod: This was the first time the Piper Jaffray team monitored iPod sales, so it doesn't have previous counts with which to compare the results. But Apple was selling twice as many iPods as iPhones last week, in line with the Street's estimate of about 10 million iPods for the quarter.
Munster tends to be more bullish on Apple than most analysts. Although he lowered his $240 price target when it was clear that the company wasn't going to release new iPhones in January, his current $180 price target is one of the highest in the business. The stock closed at $118.31 on Tuesday.
I find it comical that people criticize the guy for making predictions based on some data rather then none (like most analysts). Hey, it is just an estimate, better then most, take it for what it is. Let the whiners complain about his estimates. Good for him for collecting real data.
I'm an IT engineer for 27 years. 23 of those have been PC or PC-like years. I converted to mac several years ago because I was spending my days making tons of money fixing the same old PC problems in one form or another and felt I wanted to avoid this for myself.
Apple needs to address a simple business-like saying thats been around since the days of JP Morgan. "Time is Money". This refers in this case of how much time is LOST dealing with the idiosyncrasies of the Windows operating system and the applications you install that modify it and in some cases permanently. Any Computer engineer can figure out how to safely uninstall applications and install virus and spyware software, install patches and in some cases back-out patches, fix qwerks, clean registry entries and download and run a slew of other tools to keep windows safe, stable and working. The bottom line is that I no longer enjoy doing that. I just want the computer to work out of the box and for a long time. My time is worth using the machine for what I bought it for without having to "Get it stable" first. And my Mac is just that. Stable. Out of the box stable. Sure a PC could in theory be the same but we all know it's not safe like that for long. Apple creates the hardware and software for a good reason. Thats so they can assure that the thing works and they do. Apple has given us IT engineers something we have truly wanted but were ashamed to admit it for years. A Unix operating system that's easier to use than Windows, Faster than Windows, More stable that Windows. And if you must, click a button and RUN Windows. In a window! And don't complain about the cost of the hardware. You get what you pay for. And is it such a small price to pay in the grand scheme of things? How many hours are you saving in a year with a mac? How much is your time worth per hour? The average home computer life span is 3.7 years. convert that figure in the cost differential and you are at pennies per day. And until HP, Dell, Acer, IBM or anybody else comes out with a CNC machined, Anodized, Razor thin, Sex-Machine like a MacBook Air at any price, let me know please…
We IT guys have to find sex somewhere, It's called elegant design.. And we all have drooled over Sun hardware when it comes out of the box before.
So don't free yourself and think different.
It has worked for me. And my eyes are now wide open.
The new Iphones are coming out in June or July. MAC's can also be bought on Amazon.com and other placs.
Ipods — maybe 'just maybe' everyone who wants/needs an ipod have at least one. I own the classic, nano, & itouch.
Not many people have $5,000 to spend on all three mac toys. Finding that mythical $239 Iphone is like finding a 10 cent parking meter in Manhattan.
Iphones that are 'lightly used' like new go for around $650 on craigslist and around $800 on ebay that are 'supposedly' unlocked
If you are a real apple person, you just believe in the stock price. You never sell, and you work to buy more apple stock.
That is how real apple people should conduct themselves, if they want credibility.
I think we need to change the name of the devices Apple has been making. "Smartphone" doesn't cut it, since it leaves out the iPod Touch.
I propose using the term "pocket computer".
Statistical averaging based on observed in-store sales provides a more accurate measurement than basing estimates solely on government statistics, corporate guidance and "media buzz".
Fact is that in-store sales gives a general idea of the fervor of consumers. Web-based sales tend to hold steady, as folks who know exactly what they want and when they want it are more predictable than people who hold an iPhone in their hand for the first time and experience the product.
In store sampling gives insight into real-world acceptance of product and overall consumer confidence that can be missed by other "pure" data.
Additionally, the target price is not a prediction of what an analyst thinks the price will be! It's guidance on buying and selling strategy…primarily for longer term investment.
This came from "outside the reality distortion field"? Wow, I wonder what it's like inside that field.
ex ped: Then you've never met Steve Jobs.
Murphy,
My thought? Yes, a rough survey is better than no survey at all. According to Apple's last 10-Q (http://phx.corporate-ir.net/phoenix.zhtml?c=107357&p=irol-index), Apple counts Retail as Apple-branded retail stores. So it excludes online sales through Apple.com, sales through other resellers and I think (but am not sure, as the Conference Calls have mentioned Best Buy specific figures before) it also excludes co-branded retail spaces like the Apple Store within Best Buy concept stores that are in many BBYs throughout the country.
It also doesn't distinguish Retail along region lines (like it does its other sale segments). Granted, almost all Apple Stores are in North America, but still.
So at least for making retail assessments, a rough sample could be useful. I suppose if I were an analyst I'd look at trends of retail data and its percentage of total sales and try to apply that to overall sales number, which include online. I'm assuming that’s what Munster and his colleagues have done, but not having read the Piper report, I can't say for certain.
Okay, so I don't trust an analyst, no matter how much bogus "research" he does by walking into stores when he can't even listen to what the company says. Apple has made it clear that its product rollout schedule for iPhones are in the summer (July). Why then would he reduce his target from $240 to $180? Why did he ever expect iPhones in January? A simple phone call to the company would have confirmed the iPhone dates–heck, even one of Apple's newest store clerks could have probably told you that if those "researchers" had bothered to talk to anyone while they were in the store.
This just goes to show that these Wall Street cats don't really know their stuff as well as they should. I'm sure Mr. Munster has many other stocks he follows so I'm sure he's a busy man, but please don't contribute to the madness in this market by releasing senseless, irresponsible information.
ex ped: I'm afraid a simple call to the company would have told you nothing about their product plans.
What difference does it make where Munster puts his target price. It doesn't mean a thing. Apple might make it or not. It's good that at least he and his boys goes out to check on sales. He gets a rough estimate. Yet overall, the sad fact is all Apple sales will be down this quarter and that's what the investors will see. There will be no $180 share price for Apple this year and Munster will be off by $30. Target prices are meaningless. They change month by month.
If the U.S. auto industry collapses, the general market will drop and so will Apple. Why? Because, in theory, there'll be even less people that can afford to buy Apple's higher-priced devices and that's all that Wall Street needs to know.
Current rumor is that Apple will build out 5 million new iPhones for a start this year. Nice number, indeed. If Apple is lucky they might sell another 12 million iPhones in 2009.
But please remember, that G. Munster was the guy going around last year saying Apple was going to sell around 45 million iPhones in 2009. If that wasn't some wildly inflated number based on god knows what, and now I have absolutely no faith in his numbers at all.
Munster's the best. And as far as anyone basing things off observing retail sales….ever heard of a guy name Warren Buffet?
Whenever I see one of these Munster in-store estimates I have to wonder:
Is a rough survey with various statistical inconsistencies and a massive margin of error better than no survey at all?
It's a serious question.
Does he release information about how he factors in online sales? Does Apple release information about the percentage of sales that come from retail stores?
I'm long on aapl since 2005 so I hope he's right.
Munster is amazingly good. No other analyst bothers to show his or her homework. Maybe the dog ate it. Maybe it never existed.
What serious professional bases opinions and even publishes those opinions based on a few people monitoring sales in a retail environment – never heard of online business dummy!!!!
Interesting data, but it is also missing online sales. I am an avid Mac owner but I have never bought any of my computers or iPods in one of their stores. I usually do it online or at the nearby Best Buy. I wonder if they account for the number of items sold through that mechanism. I know it may be a minority of total purchases, but it may be significant to the final totals.
As you now can read, Apple Stock is just shy of $170 per share by the end of August of 2009