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Tech Check
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Gene Munster has cultivated a cult following among Apple's faithful; an analyst who has fan sites devoted to him because he has been out there, sometimes all alone, beating the fundamentals drum of this company, touting its strengths, eschewing its weaknesses, and quietly — with his "aww shucks" mid-Western politeness (Piper Jaffray is in Minnesota) supporting Apple through thick and thin.
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That was far easier to do last year when Apple eclipsed Google [GOOG
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] and saw its market cap jump to over $150 billion. Far tougher since with Apple shares losing almost 60 percent year to date this year. But Gene has been an Apple long's steady Eddy.
Until today.
Hell has frozen over, some will say, and hell hath no fury like an Apple investor scorned. Trust me, I know. Munster issued a report today that *Gasp*, reduced his revenue expectation for the company to a paltry $41.2 billion from $43.4 billion in 2009. Sure, it's only a 5 percent reduction, but oh what a message it sends. At the same time, he lowered his price target on Apple [AAPL
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] shares to *Gasp* to $235 from $250. That's still a Street high, I believe. He says he's noticed a rapid contraction in the economy and he thinks it'll be a trend that continues through 2009. Umm, duh. That will mean slower growth rates for Apple's Macs, he surmises.
Even though his reductions are slight, they are significant since it's the first time in 5 years that he's reduced Apple numbers. Any Apple numbers.
As you might imagine, Munster is being skewered on blog after blog. At least by Apple longs who seem to have lost their savior. Apple shorts however, have suddenly found a new poster boy, propping Gene up as a new kind of deity, savior, call him what you will. Gene however, is still maintaining his "aww shucks" demeanor, even as older iPods are burning on his front lawn.
I talked to him just a few minutes ago, and interestingly, he's still holding firm to his Street-high 45-million-iPhones-sold number for 2009, despite the fact that Nokia [NOK
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], Palm [PALM
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] and Research in Motion [RIMM
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] have all whined about slower growth in the market place and those pesky execution issues that are preventing their businesses from gaining better traction. Apparently not an issue for Apple. At least according to Gene.
"The reality is everyone is gonna be impacted, some more than others, and Apple isn't alone," he tells me. "Do we really think something's wrong? But we're only tipping our hand a little bit?," he asks. "Look, these are the real numbers. We're not trying to whisper something worse than it is. These are what we're expecting. Directionally it's a big change, no question about it. It's coming to grips with reality that no one's immune."
And coming to grips that while this analyst might be angering a lot of Apple fans this morning, this isn't about them. It's about all Apple investors. Long and short. And mostly, it's about Munster's credibility. He's calling it like he sees it. He's been wrong before. And so have I. But I'll match his track record against any Street analyst and the honest way he generates his research.
There's an economic slowdown afoot the likes of which this country hasn't seen in 75 years. It stands to reason that everyone will feel it. The message I'm taking away from Munster's report: Apple will feel the slowdown too, but no where near as much as others against whom the company competes.
Questions? Comments?
Data is a real-time snapshot *Data is delayed at least 15 minutes