Apple Inc (AAPL)

[fmikehugo]

07:30 Credit Suisses discusses iPod market opportunity (63.38 )

Credit Suisse notes that despite the Apple iPod's overwhelming popularity, investors are becoming increasingly concerned with its growth opportunities, competitive pressures, slowing product introductions, and the law of large numbers. Firm believes that over time Apple's iPod can easily exceed Sony's 309 mln cumulative Walkman and Discman shipments.

Firm's analysis indicates that a sale of an iPod ($203 ASP) creates on average $253 in total Apple revenue, with a blended gross margin of 24%. They believe Apple is still in the early stages of its product expansion and that the company can grow its iPod units at least 20% for the foreseeable future, based on the iPod's low penetration rate, accelerating replacement cycle, overall market opportunity, and defensible competitive positioning.