Here’s Why Apple Needs to Pursue China Mobile

If Apple (NASDAQ:AAPL) were to enter into a deal with China Mobile (NYSE:CHL), the world’s largest wireless provider by subscriber numbers, it could take 1 percent of the operator’s customers and add $45 to its own stock price. RBC Capital Markets analyst Amit Daryanani made the assessment, adding that Apple could potentially sell between 10 million and 16 million iPhones to China Mobile customers within the first 12 months.

China Mobile has nearly 700 million subscribers, with 75.6 million of those currently on its high-speed 3G network. These high numbers would be great for Apple profits, the analyst said, with the deal adding about $3 to the company’s annual earnings per share.

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The iPhone maker is rumored to be in talks with China’s wireless leader, but issues of network compatibility remain. Daryanani, who based his estimates on adoption rates of the iPhone at AT&T (NYSE:T) and Verizon (NYSE:VZ), said he expected Apple to finalize the agreement by early next year. RBC has maintained an Outperform rating and a $750 price target on Apple stock.

Meanwhile, China Mobile’s rivals, China Telecom (NYSE:CHA) and China Unicom (NYSE:CHU), are preparing to launch the iPhone 5 as soon as late this month or early December. According to The Wall Street Journal, the two carriers only await government approval.

Apple’s fourth-quarter China sales came to $5.7 billion, or 16 percent of its total revenue.

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