Apple’s New iPhones Face Shipping Delays

Apple Inc. (AAPL)’s new iPhones will take as many as four weeks to ship, a sign that early demand for the smartphones is outstripping supply.

The iPhone 6 Plus, which has a larger display, will take three to four weeks for shoppers who pre-ordered online yesterday, according to Apple’s website, as people rushed to buy the handset hours after the company began taking pre-orders. Certain iPhone 6 models, which have a slightly smaller screen, will take seven to 10 business days to arrive, though some versions are still available for delivery on Sept. 19 when the devices are set to go on sale in stores. Pre-orders through some individual carriers’ websites indicate shipments could take even longer.

“Response to iPhone 6 and iPhone 6 Plus has been incredible, with a record number of pre-orders overnight,” said Trudy Muller, a spokeswoman with Cupertino, California-based Apple.

Apple this week unveiled the new smartphones with rounded edges, thinner frames and higher-resolution displays, and they became available for pre-order starting at 3 a.m. New York time yesterday. Chief Executive Officer Tim Cook is counting on the new devices to usher in demand for other products he introduced this week, from the iPhone-compatible Apple Watch to the credit card-substituting Apple Pay service.
Demand for the latest iPhone is the greatest AT&T Inc. has seen in two years, Ralph de la Vega, CEO of its mobile division, said yesterday at a Goldman Sachs media conference.

“Every time there is a change in design, and this is clearly a change in design for Apple, there is an uptake,” de la Vega said. “I think there’s going to be a great uptake, which is good for us.”

Familiar Pattern

This isn’t the first time Apple and phone carriers have seen iPhone models delayed well before they were available in stores. In 2012, the iPhone 5 was delayed for shipment by a week after a rush of orders, and in 2011 the iPhone 4S sold out at AT&T, Verizon Wireless, and Sprint Nextel Corp. only five days after pre-orders began.

“The iPhone 6 Plus experiences severe supply constraints,” Brian White, an analyst at Cantor Fitzgerald, wrote in a note to investors.

The iPhone 6 has a 4.7-inch display and the iPhone 6 Plus has a 5.5-inch one, while the previous iPhones have a 4-inch screen. The iPhone 6 costs $199 to $399 with a two-year contract, while the 6 Plus is priced at $299 to $499. The devices will come in silver, gold and space gray.

“It’s the biggest advancement ever in iPhone history,” Cook said yesterday in an interview with Charlie Rose at Bloomberg headquarters in New York. “We think that the upgrade cycle here and the number of people that will switch from other smartphones — it will be enormous.”

Twitter Gripes

Customers took to Twitter to complain of difficulties loading Apple’s website to place pre-orders. The website had problems loading at about 3:22 a.m. New York time yesterday, according to Isitdownrightnow.com, a site that tracks Internet issues.

Shares of Apple rose less than 1 percent to $101.66 at the close in New York yesterday. The stock is up 27 percent this year.

While the company normally doesn’t disclose figures for its production runs of new products, it typically has a supply of its new devices in stores on the first day.

Carriers, which often offer deals when a new iPhone comes out to lure more data-hungry smartphone users and bolster their market share, are again offering incentives that may be bolstering interest.

Carrier Incentives

Verizon is promoting a “Trade In & Trade Up” smartphone sale on its website, offering $100 to $300 for used devices. AT&T said earlier this week it will let customers swap in their old iPhone for a new iPhone 6 and as much as a $300 credit. Sprint is offering the “iPhone for Life” plan, which for $70 a month lets users rent the iPhone 6 and upgrade to a new version every two years, while T-Mobile US Inc. says it will top the best trade-in price with an added $50.

“Right now, we’re in an online, preorder phase, and will share info on in-store when it becomes available,” Debra Lewis, a Verizon spokeswoman, said in an e-mail.

While AT&T is planning on having new iPhones in stores by Sept. 19, the company won’t comment on which specific models will be available, said Mark Siegel, a spokesman for the carrier.

Legere Apologizes

T-Mobile will have the iPhone 6 Plus in stock in stores when the device goes on sale next week, said Tolena Thorburn, a spokeswoman for the Bellevue, Washington-based company. The company’s website was unable to process orders part of yesterday, with its site carrying a message attributing the errors to “strong demand for preorder devices.”

T-Mobile CEO John Legere apologized to customers on Twitter, saying “demand has been huge but we are on it.”

Michelle Mermelstein, a spokeswoman for Sprint, declined to comment on whether the Overland Park, Kansas-based company would have the iPhone 6 Plus in stores on Sept. 19.

The iPhone remains the most important piece of Apple’s business.

The handset accounted for about half of Apple’s $171 billion in revenue in its last fiscal year, and with sales of the iPad slowing, the company needs to keep the iPhone a blockbuster to maintain growth.

The handsets will initially be available in a limited set of markets — including the U.S., Australia, Canada, France, Germany, Hong Kong, Japan, Puerto Rico, Singapore and the U.K. – – for pre-order and shipping on Sept. 19, the company has said. China, one of Apple’s biggest markets, won’t get the new devices at first, though the company said it plans to have the phones in 115 countries by the end of the year.

Salesforce.com Update BUY

CRM : NYSE : US$55.71 BUY 
Target: US$65.00
WHAT THE FIRM COULD DO TO HELP THE STOCK OUTPERFORM THE MARKET.
Investment thesis
As the best-in-class cloud software firm, Salesforce remains our favorite large cap
growth stock. With more transparency (revenue run-rates of the various clouds was
a good start), the firm could see multiple expansion; however, even if this doesn’t
happen, we expect the shares to advance at least 20% over the next 12 months.
That’s a worthwhile potential return for a large cap stock. BUY.
 Another upside print. CRM reported Q2/15 revenues and non-GAAP EPS of
$1.32B and $0.13, which were respectively $29M and a penny ahead of our
estimates. Constant currency revenue growth was 37% in the quarter, and
calculated billings of $1.35B were nicely ahead of our $1.30B estimate and up
33% compared to a year ago. Total backlog (billed and unbilled) ended the
quarter at $7.35B, which is up 17% versus Q2/14. Lastly, CRM generated FCF
of $174M, or $0.27 per share, which was well ahead of our $0.18 estimate;
YTD FCF is up 90% compared to 1H/14.
 Color from the call. The firm noted an 8-figure deal (one of several) with 3M in
the quarter as well as a Salesforce1 Platform deal with Safeway. In the quarter,
sales cloud was 49% of subscription revenue, service cloud 26% (though the
fastest growing), SF1 platform 15%, and marketing cloud 10%. On the event
front, CRM will host its Connections marketing cloud conference in late
September (which could pressure a stock like MKTO as the firm makes noise on
that front), and management suggested that the firm will be introducing an
entirely new product line and category at Dreamforce in October.
 Outlook: F2015 revenues increase ~$40M, EPS inches up by a penny. This was
a classic beat and modest raise quarter. Revised guidance points to 32%
revenue growth and ~150 bps of operating margin expansion in F2015.
Interestingly, Q3/15 marks the first full quarter that CRM will have lapped the
ET acquisition, and implied billings guidance suggests healthy, 25% growth

John MCAFEE gives Blackberry A Big PR Push

http://www.rtphone-on-privacy-concerns-m_NBADwgTsWDLonopLMLfw.html

http://www.rtphone-on-privacy-concerns-m_NBADwgTsWDLonopLMLfw.html

Video on smartphone lack of security.

 

McAfee: Dump Your Smartphone to Protect Privacy: Video
Antivirus Pioneer John McAfee discusses his internet privacy concerns on “Bloomberg West.” (Source: Bloomberg TV

McAfee: Dump Your Smartphone to Protect Privacy

 

Twitter Update

Twitter stock slumps 50 percent as Goldman, Deutsche Bank still say `buy’

13 hours ago – Reuters
Twitter stock slumps 50 percent as Goldman, Deutsche Bank still say `buy’By Supantha Mukherjee and Saqib Iqbal Ahmed(Reuters) – Twitter Inc investors who heeded the advice of high-profile banks such as Goldman Sachs Group Inc and Deutsche Bank AG to buy the social media company’s shares might be kicking themselves.

Much more accurate calls were made by Wells Fargo, Atlantic Equities , Macquarie Research, and Jack A. Bass ,who advised clients to get out of the high-flying stock about the time it peaked in December.

On Wednesday the stock fell as low as $37.24, 50 percent below its peak of $74.73 the day after Christmas, wiping almost $18 billion off Twitter’s market capitalization.

The downgrades, and the subsequent swoon by the stock, reflect concern about slowing growth in Twitter’s user base and the company’s ability to reverse the trend. Year-on-year growth in the number of Twitter users has fallen for five straight quarters, and the company said on Tuesday that its 255 million monthly users, on average, appeared to check the service less frequently than a year ago.

That in turn has fueled doubts that Twitter could one day attract as many users as Facebook Inc’s 1.2 billion, or match its much larger rival’s power as an advertising vehicle. It’s also raised questions over whether it can sustain growth over the long term. While no one is suggesting Twitter will lose its consumer cachet as happened to companies such as MySpace or Orkut, neither can anyone guarantee that as tastes change newer rivals won’t usurp it.

“Can they become a mainstream company? That’s the open question,” said Ben Schachter, the Macquarie Securities analyst who downgraded Twitter’s stock to “underperform” on December 27 – the day after it peaked.

It’s a far cry from the enthusiasm that greeted the company when it debuted on the New York Stock Exchange on November 7 and its shares soared 73 percent over the offering price. There was no let-up for the next two months, as the stock scaled fresh highs with little or no news to justify the valuation.

That got some analysts worried. Schachter, speaking to Reuters on Thursday, recalls a “runaway momentum.”

Google Update

Shares in Google have dropped 5% despite the technology giant reporting a first-quarter profit rise of 3%.

Profits were $3.45bn (£2.05bn), but investors are preoccupied by Google’s inability to maintain advertising prices.

A widely watched measure, the average “cost per click”, was down 9% from a year earlier.

Another weak spot highlighted in the report was the firm’s discounted sale of Motorola Mobility to Lenovo.

Google sold the smartphone maker to Lenovo in January for close to $3bn, after paying $12.5bn for the firm less than two years ago.

Despite investors’ reaction, Google’s chief executive, Larry Page, was upbeat: “We completed another great quarter,” he said in a statement.

“We got lots of product improvements done, especially on mobile. I’m also excited with progress on our emerging businesses.”

However, Google continues to struggle with its ability to charge advertisers higher prices for mobile ads, which are increasingly important with more and more consumers accessing Google’s browser through their smartphones.

Advertisers have proven reluctant to pay as much for ads on mobile screens compared to Google’s bread-and-butter desktop ads, which have been the main revenue generator at the firm.

Rates for mobile ads can be half as much as on personal computers, according to Needham & Co analyst Kerry Rice.

However, Google expects mobile ad prices to catch up with PCs eventually as it becomes easier for consumers to buy products using mobile devices, Google chief business officer Nikesh Arora said.

‘A little bit dodgy’

Google has greatly diversified its portfolio of products in recent years, speculatively branching out into phonesdronesGoogle Glass, and even thermostats and fire alarms, CNet technology analyst Larry Magid said.

“Some of these crazy ideas need to become less crazy and more profitable,” he told the BBC. “Their core business, what really brings in the money, that’s beginning to get a little bit dodgy for them.”

Google’s results were not the only ones to disappoint investors on Wednesday.

Technology giant IBM reported its lowest quarterly revenue in five years.

IBM attributed the drop in revenue, which went down 4% to $22.5bn, to weak hardware sales.

Enterprise technology spending has shifted away from traditional computing giants as governments and corporations move towards online services, large-scale data analysis and IT security, FBR analyst Dan Ives said.

Facebook Target Price $ 60

 

FB : NASDAQ : US$48.45
BUY 
Target: US$60.00

 

INITIATING COVERAGE WITH BUY; EARLY STAGES OF MONETIZING THE USER BASE
Investment recommendation
We initiate coverage of Facebook with a BUY recommendation and $60 price target. Despite the stock price’s recent doubling, we believe the company is very early in generating revenue from its enormous user base.
While the path higher may not be linear, we expect Facebook’s reach, robust network effects, vast self-disclosed user data, and product innovation will increasingly make it a high-priority target destination for many marketers.
Investment highlights
 While the US is close to saturation, Facebook’s global penetration currently stands at only ~20% and we believe there is still room for user growth. Facebook already has nearly 1.2 billion monthly users, but we believe the user base can grow by roughly one-third by 2015.
 In light of the continuous user shift to mobile consumption, Facebook mobile monetization has become vital. We believe that Q2/13 was a turning point in the company’s mobile monetization. While some categories of mobile ad spend may be volatile (app downloads), we believe Facebook’s sponsored stories product is at last compelling brand advertisers to commit more spend to mobile.
 We believe Facebook is early in innovating both for ad and user products. We expect the long-anticipated video ad product and forthcoming Instagram monetization could lend upside to our outlook. In addition, new features such as real-time social metering and more ties to consumer media and entertainment could put the user base on a steeper engagement curve.
Valuation
Our $60 price target is based on 45x our 2015 EPS estimate of $1.33.
Risks
Competitive platforms might impact usage. Individuals may opt out of “sharing overload” over time. Higher ad loads could impact user satisfaction. Dual share class structure with the CEO controlling 53% of voting rights.

LinkedIn BUY Target $ 200

Image representing LinkedIn as depicted in Cru...
Image via CrunchBase

LNKD : NASDAQ : US$176.95
BUY 
Target: US$200.00

COMPANY  DESCRIPTION:

LinkedIn is the world’s largest professional network on the Internet with more than 200 million members in over 200 countries and territories. LinkedIn generates revenue through selling Hiring Solutions to corporations, Marketing Solutions to Advertisers, and Premium Subscription to members and recruiters.

Investment recommendation

We areincreasingly confident in the company’s strategy, opportunity, competitive position and long-term outlook. We note greater interest in
the transition occurring within Marketing Solutions and the timing of when growth might reaccelerate, and we will be watching the company’s progress with feed-based Sponsored Updates advertising for signs of inflection later this year.
Investment highlights
 We continue to expect Marketing Solutions (MS) revenue growth to be relatively flat sequentially for Q2 and Q3, as ~$8-10 million per quarter in “legacy” ad revenue rolls out of the model; we believe Sponsored Updates can return MS to growth by Q4.
 Member engagement continues to climb, and our new engagement index shows a doubling of per-member activity over the past five quarters.
 The transition to in-house hosting could contribute to as much as 500 bps of gross margin expansion over the next four years, although we are only modeling 300 bps.
Valuation
Our $200 price target is unchanged and is based on 60x our 2016 EPS estimate of $4.96 discounted to present at 11%.