Sell Apple? IPhone, iPod News Bores Investors
Apple announced Tuesday that it is driving up the power of its iPhone and iPod Touch brands, doubling the units' memory -- and driving up the price for many models.
Ordinarily, any announcement from Apple and its visionary chief executive Steve Jobs boosts the stock price immediately.
But Apple shares ended Tuesday trade down $2.25, or 1.71 percent, at $129.40 on the Nasdaq. Does this mean the information and digital media giant is heading for harder times?
- Video: Watch the entire analyst interview (3 mins 26 sec)
Not according to Andy Hargreaves, analyst at Pacific Crest Securities. He conceded that the upgrade is not radical enough to "drive huge unit volume" -- and investors still have too much "uncertainty with carrier payments" (i.e. AT&T subscription plans) and "unlocked iPhones."
CNBC's Jim Goldman agreed, adding that "the Apple faithful" are irked when the company introduces an upgrade too soon after they've purchased a new gadget -- rendering their expensive purchase obsolete.
But Hargreaves maintains that this is a temporary setback for Apple -- and calls it "the No. 1 tech stock to be buying."
He rates the stock "outperform" and has a $210 price target for it. Apple is "at the apex of digital entertainment," he explained. "They monetized music [via iTunes]...and are well-positioned for digital video."