Analyst: Apple Reaped Benefits of Strong Weekend Demand for Tablets
Cantor Fitzgerald analyst Brian White took a look at the effect that the Black Friday shopping weekend had on Apple (NASDAQ:AAPL) in a recent note to investors. According to a survey of 38 Apple Stores conducted by Cantor Fitzgerald over the weekend, Apple “managed the rollout of the iPad mini with Retina Display well.” Some analysts and research firms had previously predicted that Apple would be struggling to meet demand for the iPad mini with Retina display due to supply constraints.
Apple’s lack of “broad-based stock outs” was especially impressive considering that a weekend survey conducted by the CEA (Consumer Electronics Association) found that consumer demand for tablets was even stronger than initially expected. A CEA survey conducted before Black Friday found that 30 percent of consumers shopping for an electronics product this weekend were planning on buying a tablet.
However, according to a CEA conference call held on Sunday, the consumer demand for tablets was even stronger than expected. According to White, the CEA’s latest survey found that 39 percent of consumers shopping for an electronics product this weekend were either buying or planning to buy a tablet. Despite the stronger-than-expected demand for tablets, Apple managed to provide its retail stores with an adequate supply of most versions and capacities of its popular iPad mini with Retina display. However, the Cantor Fitzgerald analyst did find some shortages in his survey of 38 Apple Stores.
According to White, “all Wi-Fi only models for both the iPad mini with Retina Display and first-generation iPad mini” were available at all the surveyed stores. However, Wi-Fi/Cellular versions of the Retina iPad mini in the 64GB and 128GB capacities had very limited stock available. On the other hand, supplies of the 16GB capacity Wi-Fi/Cellular Retina iPad mini were plentiful.
White found that 47 percent of the surveyed Apple Stores were sold out of the iPad mini with Retina Display 128GB models, while 42 percent were sold out of the 64GB models. However, only 29 percent of the Apple Stores were out of the 32GB models and only 3 percent were sold out of the 16GB models. White also noted that the first-generation 16GB iPad mini was widely available.
The CEA also noted in its conference call that the average U.S. household owns 1.5 tablets, which is still less than the 2.9 TVs found in the average household. White believes this information “speaks to further growth opportunities for the tablet.” The overall increasing consumer appetite for tablets and the strong demand for tablets during this holiday shopping season “is a clear positive for Apple’s iPad franchise,” wrote White. Cantor Fitzgerald maintains a “Buy” rating and a $777 price target on Apple shares.
Here’s how Apple closed out Friday’s shortened trading session.
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