Wall Street doesnt like the iPad but consumers will

Wall Street analysts have cast doubt on the potential success of the iPad, marking down the stock after its high profile launch. The criticisms seem to center on its price of between $500 and $850. It is seen as simply too expensive for most consumers despite its obvious appeal. I think these analysts underestimate the sheer love customers have for all things Apple. They are probably right that the product is a few hundred dollars too much but I doubt that will prevent too many customers from buying. Just take a look on eBay at how much people are willing to pay for an unlocked iPhone and you’ll see that Apple has the ability to command a sizeable price premium. In other words logic is on the side of the analysts but consumers can be horribly illogical. Get ready for lines to appear at your local Apple store when the product actually arrives…

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One Comment on “Wall Street doesnt like the iPad but consumers will”

  1. It will be interesting to see if Apple drops iPad prices over time. It’s rumored the margin is as high as 50% on this device: http://www.pcworld.com/article/188196/apples_ipad_profit_breaking_it_down.html

    Either way I think the stock’s getting punished partly on valuation but 18x earnings still seems a conservative P/E relative to its peers.


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