Happy New Year!�
Here are some things going on this morning in your world of tech:
Tech is showing strength this first trading day of the new year, along with most other stocks, after the U.S. Congress last night passed a bill to avert the so-called fiscal cliff.
Nasdaq 100�futures for the March contract are up 59 points at 2,714, and tech stocks large and small are seeing pre-market gains.
Apple rising
Apple (AAPL) is among this morning’s top gainers, rising $20.61, or almost 4%, at $552.35, continuing pre-market gains, amidst yet another mixed set of reviews from the Street.
Piper Jaffray’s Gene Munster reflects on the chatter of late about Apple making a smart wristwatch, speculating that “while we are unsure of the ultimate launch timing (likely 2014 or later), we believe that Apple will eventually introduce some type of wearable computing product.”
Next week’s Consumer Electronics Show in Las Vegas, of course, will show off such marvels from other companies, including Italy’s i’m Watch.
Tavis McCourt of Raymond James, while reiterating an Outperform rating on Apple shares, cuts his price target to $690 from $700, after lowering his March-quarter iPhone unit sales estimate to 37 million units from 42 million, to reelect “a faster supply ramp,” while raising his estimate for the December quarter to 48 million from 46 million.
In defense of the stock, McCourt writes, “We continue to view Apple�s growth rate as slowing, but still consistent with double-digit top line growth for the foreseeable future, and EPS growth improving as FY13 progresses.”
In case you missed it, a report this morning�from France24�states that Apple is shifting production of its “A6X” microprocessor, found in the iPad, from Samsung Electronics (005930KS) to Taiwan Semiconductor Manufacturing (TSM), citing an article in the Chinese-language Commercial Times of Taiwan.
At the same time, there seems to be no slowing down�Samsung.�Engadget‘s�Zach Honig this morning writes that the company may reach the 10 million mark in sales of the “Galaxy Note II” phone-tablet by the end of this quarter, with brisk sales in of 5 million already notched up last month. Honig doesn’t say where the sales projection comes from.
Google‘s (GOOG) shares are up $9.82, or 1.4%, at $717.20 despite a cautious note from Oppenheimer & Co.’s Jason Helfstein, who reiterates a “Perform” rating on the shares, and cuts his price target to $715 from $760, arguing that while the company’s push into making its own Android-based tablet computers is smart, nevertheless, the company will see margin dilution from these costs, as well as higher traffic acquisition costs (TAC) as the majority of tablet usage and mobile commerce is generated from iOS devices.” He cut his revenue and profit estimates for this last year and this year.
The chip view
There were a number of reports this morning regarding data released Monday night to subscribers by the�Semiconductor Industry Association�regarding global chip sales in November. Bernstein Research’s Stacy Rasgon writes that the 8.5% year-over-year increase in sales, and the month-over-month drop of 1.3%, were typical of Novembers past. Among the categories of chips showing declines, “MPU [microprocessor] sales were (perhaps unsurprisingly) extremely weak in November, down 13.8% MoM, below typical patterns (up 14.1% MoM) driven by both shipment and price declines,” though he notes that neither Intel (INTC) nor Advanced Micro Devices (AMD) participate any longer in the SIA’s survey.
J.P. Morgan’s Christopher Danely was looking for a month-over-month rise of 2.5% instead of the 1.3% decline, but he concludes by reiterating a forecast for “a 2% YoY revenue decline in 2012 followed by 6% YoY revenue growth in 2013.”
Nevertheless, Intel shares are up 44 cents, or 2%, at $21.06 in pre-market trading, while AMD shares are up 15 cents, or 6%, at $2.55.
The hardware view
There were a raft of notes this morning assessing the state of computing hardware.
Topeka Capital’s Brian White writes that he’s just as skeptical of hardware companies this year as last, “avoiding the more cyclical tech names for the most part and focusing on companies best positioned to benefit from key secular tech trends that we believe are in place this year.” Apple is his top pick, he writes.
Abhey Lamba of Mizuho Securities USA writes that “The PC market is unlikely to improve any time soon while Apple will keep performing well at the higher end” and that “smartphones and tablets are likely to keep gaining consumers� wallet shares” while companies “exposed to cloud computing adoption should perform well in 2013.”
Shares of Hewlett-Packard (HPQ) are up 43 cents, or 3%, at $14.68, while shares of Dell (DELL) are up 22 cents, or 2%, at $10.36. HP may be getting a lift from its filing of its 10-K with the Securities & Exchange Commission last Thursday. Bloomberg’s Aaron Ricadela yesterday picked up on phrasing in the filing to the effect that HP may dispose of some divisions.
Mixed stats for Facebook
There was also a bunch of notes about Facebook (FB), positive, for the most part.
Capstone Investments’s Rory Maher reiterates a Buy rating and a $35 price target, writing that software tools he’s used to monitor Facebook use suggest growth of usage in Russia is accelerating. Russia could be a $500 million annual revenue opportunity, he believes.
And J.P. Morgan’s Doug Anmuth reiterates an Overweight rating on shares of Facebook, and a $35 price target, writing that “We believe Facebook�s advertising revenue will accelerate at least through 1Q13 and we are raising our Advertising estimates 6-7% for 2013 and 2014.
On the other hand, Cowen & Co.’s John Blackledge started coverage of the stock with a Neutral rating and estimates below those of the Street. While Facebook will sees its worldwide share of advertising rise from 4.5% last year to 7.2% by 2012, nevertheless, he thinks the Street is modeling combined desktop and mobile ad revenue growth for the company that’s twice what it may turn out to be in coming years. He thinks the stock has 16% downside from here.
Facebook shares this morning are up 79 cents, or 3%, at $27.41.
Other strong gainers this morning include�Research�in Motion�(RIMM), up 39 cents, or 3.3%, at $12.26, and�Nokia�(NOK), up 24 cents, or 6%, at $4.19.
Speaking of smartphones, in case you missed it,�DigiTimes‘s�Cage Chao,�Erica Yen, and�Steve Shen write this morning that unnamed industry sources tell them that five-inch displays and quad-core processors will be “mainstream technologies” at the Consumer Electronics Show next week, and at the�Mobile World Congress gathering that happens in Barcelona every February. While quad-core is already becoming de rigueur in high-end phones, the authors write that chips from�MediaTek (2454TW) and from�Spreadtrum (SPRD) using four CPU cores will bring the technology to mid-range smartphones in the second half of this year.
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