Apple’s New iPad Takes Aim

Apple (NASDAQ:AAPL) may be going on the defensive and attacking the hybrid PC market with its latest memory-rich iPad, according to Citibank analyst Glen Yeung. Apple announced a new iPad with twice the memory of its present largest model on Tuesday. The new tablet, with 128 GB storage, will be available starting February 5 for $799 for a Wi-Fi version and $929 for a cellular model.

“Given what we estimate to be a three-quarter slide in 10-inch iPad unit sales, we can’t help but detect a defensive element to Apple’s latest iPad SKU, trying to head off the onslaught of Haswell-based [Intel (NASDAQ:INTC)] Ultrabooks & hybrids targeted for release [in the second half of 2013],” the analyst wrote in a research note on Wednesday.

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Intel is expected to debut its Haswell-chip based laptop-tablet hybrids later this year, with Microsoft’s (NASDAQ:MSFT) Surface Pro being a prominent member of the group. It is expected to have 128GB of space, a keyboard cover, and come with a $999 price tag. The price tag of $799 puts this iPad model above the average selling price of a laptop, which is $703, bringing the two into the same wallet discussion, Yeung added.

Other similar devices include Hewlett-Packard’s (NYSE:HPQ) Envy x2, Samsung’s (SSNLF.PK) ATIV Smart PC 500T Tablet, Asus’ VivoTab, and Acer’s Iconia W510.

According to Yeung, the 128GB iPad gives Apple a new way to attack the 200-million strong market of non-Apple laptops. This battle will particularly play out in the enterprise market, the analyst added.

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As far as margins go, Yeung believes the addition of the device will prove accretive. “Indeed, 128GB is the optimal configuration, noting that a hypothetical introduction of a 256GB version would be dilutive at current pricing,” the analyst said.

Here’s how Apple has been trading technically in 2013:

Screen Shot 2013-01-30 at 9.21.35 PM

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