Apple has gained share of the smartphone market versus Samsung for the first time in nearly three years
Apple continues to gain on Samsung in smartphone sales, with the iPhone 6 and iPhone 6 Plus possibly stealing a larger share of the market from Android users than their predecessors did. Analysts (at least those in the U.S. anyway) remain convinced that sales of Apple’s two newest iPhones remain strong.
Analysts at Canaccord Genuity bumped up their price target for Apple based on the strong iPhone sales they’ve been detected. Meanwhile Morgan Stanley analysts say Apple is closing the gap with Samsung for the top spot in the smartphone market.
The latest Robinhood Investors Conference is in the books, and some hedge funds made an appearance at the conference. In a panel on hedge funds moderated by Maverick Capital's Lee Ainslie, Ricky Sandler of Eminence Capital, Gaurav Kapadia of XN and Glen Kacher of Light Street discussed their own hedge funds and various aspects of Read More
Canaccord Genuity ups Apple price target
In a report today, analyst Michael Walkley of Canaccord Genuity said he raised his price target for Apple from $135 to $145 per share. He maintained his Buy rating on the company’s stock and estimated that the iPhone took an astounding 93% of the smartphone profits in the December quarter. The reason Apple was able to take such a massive piece of the profit pie is because the average selling price of the iPhone was $698, compared to Samsung’s average smartphone price of $206.
According to Walkley, their recent smartphone survey indicates that the iPhone 6 and iPhone 6 Plus have been much more successful in attracting Android users than the iPhone 5 and iPhone 5S were. And as Apple’s installed base grows, he said the company’s future looks bright as it has a high rate of customer retention and loyalty. The analyst estimates that there are about 404 million iPhone users and that only 15% of them are upgraded to the iPhone 6 or iPhone 6 Plus.
Although there has been debate on whether Apple or Samsung won in smartphone unit sales in the December quarter, Walkley takes the side of Apple on this one. The company sold 74.5 million iPhones in the December quarter, although it’s unclear exactly how many smartphones Samsung sold because it does not distinguish between smartphones and feature phones in its earnings reports.
Apple is catching up to Samsung
In a separate report dated Feb. 6, Morgan Stanley analyst Katy Huberty and her team said the December quarter marked the first time Apple gained share in the smartphone market against Samsung since early 2012. In fact, she said the company was the biggest share gainer among the top five smartphone makers. Meanwhile Samsung actually lost the largest amount of share during the quarter.
According to Huberty, Apple expanded its share of the market by 220 basis points year over year due to greater than expected demand for the iPhone 6 and iPhone 6 Plus. Like Walkley, she thinks just a small percentage of the iPhone installed base has upgraded to one of the new models, so she expects demand for larger-screened iPhones will continue even into next year. By the end of the iPhone 6S cycle, she expects the majority of iPhone owners to have one of the models with the larger display.
Huberty added that Samsung lost 910 basis points of market share in smartphones, an acceleration from the 850 basis points the Korean smartphone maker lost in the previous quarter and the 720 basis points it lost in the second quarter of 2014. Because Apple gained such a large share of the market and Samsung lost such a large share, they almost tied for the title of top smartphone seller for the December quarter. Samsung reportedly had a 19.8% share of the market, compared to Apple’s 19.6%.