Posts tagged analysts
Microsoft’s Windows Phone platform will have the second-biggest slice of the smartphone market by 2015, analyst firm IDC predicted, ahead of Apple’s iOS.
The prediction that Microsoft’s mobile platform will be second only to Android in the global smartphone market is based on Nokia’s announcement that it would abandon Symbian for Windows Phone 7.
“Up until the launch of Windows Phone 7 last year, Microsoft has steadily lost market share while other operating systems have brought forth new and appealing experiences,” said Ramon Llamas, senior research analyst with IDC’s Mobile Devices Technology and Trends team.
“The new alliance brings together Nokia’s hardware capabilities and Windows Phone’s differentiated platform. We expect the first devices to launch in 2012. By 2015, IDC expects Windows Phone to be number 2 operating system worldwide behind Android,” he continued.
In 2015, IDC expects Android to have a 45.5 percent share of the smartphone market, more than double Microsoft’s 20.9 percent. “For the vendors who made Android the cornerstone of their smartphone strategies, 2010 was the coming-out party. This year will see a coronation party as these same vendors broaden and deepen their portfolios to reach more customers, particularly first-time smartphone users,” Llamas said.
Apple’s iOS will be in third place with 15.3 percent by 2015 — slightly down on the 15.7 percent it can boast today – ahead of RIM’s BlackBerry on 13.7 percent.
Symbian will fall away to just 0.2 percent by 2015, IDC said, with other operating systems making up the remaining 4.6 percent.
According to IDC’s Worldwide Quarterly Mobile Phone Tracker, smartphone vendors will ship more than 450 million smartphones in 2011 compared to the 303.4 million units shipped in 2010.
IDC also claimed that the smartphone market will grow more than four times faster than the overall mobile phone market in 2011.
Equities research analysts at Canaccord Genuity reiterated a “hold” rating on shares of Motorola, Inc. (NYSE: MOT) in a research note to clients and investors on Friday. The analysts currently have a $9.00 price target on the stock.
Separately, analysts at Hudson Securities initiated coverage on shares of Motorola, Inc. in a research note to investors on Thursday. They set a “buy” rating and a $10.00 price target on the stock.
Motorola, Inc. provides technologies, products and services for mobile phones. Its portfolio includes wireless handsets, wireless accessories, digital entertainment devices, set-top boxes and video distribution systems, analog and digital two-way radios, wireless and wireline broadband network products, and end-to-end enterprise mobility products. The Company operates under three segments: Mobile Devices segment, Home and Networks Mobility segment and Enterprise Mobility Solutions segment. In January 2010, the Company acquired SecureMedia from Innovation Advisors. In February 2010, the Company acquired BitBand, a provider of content management and delivery systems, specializing in video on demand for Internet protocol television (IPTV). In September 2010, the Company acquired Aloqa GmbH, a developer of location-based software and technologies.
Shares of Motorola, Inc. (NYSE: MOT) traded up 0.00% during mid-day trading on Friday, hitting $8.88. Motorola, Inc. has a 52 week low of $6.04 and a 52 week high of $8.95. The stock’s 50-day moving average is $8.1 and its 200-day moving average is $7.78. On average, analysts predict that Motorola, Inc. will post $0.08 EPS next quarter. The company has a market cap of $20.863 billion and a price-to-earnings ratio of 43.32.
Reporting its third-quarter results on Friday, Verizon Communications said that even though its profits for the quarter witnessed a drop year-on-tear, the figures still managed to beat the analysts’ estimates.
Statistically speaking, the third-quarter net income at Verizon Communications – the co-owner of the Verizon mobile-phone business with Vodafone Group – dropped to $881 million, or 31 cents per share, from the same quarter last year figures of $1.18 billion, or 41 cents a share.
The company further reported that the profit figures, which stood at 56 cents a share, after excluding one-time items like payments pertaining to its pension fund and charges from sales and acquisitions, beat the 54-cents-a-share estimates by analysts in a Bloomberg survey.
The company’s third-quarter revenue fell 2.9 percent year-on-year, from $27.3 billion to $26.5 billion; largely because of a loss of revenue from sold operations. The analysts surveyed by Bloomberg had forecast $26.3 billion in revenue during the quarter.
Noting that Verizon has added new mobile phones to its network to boost growth, analyst Craig Moffett, at New York’s Sanford C. Bernstein & Co, said: “Verizon has been doing exceedingly well with its Android launch. They’ve had a pretty steady diet of sexy new phones, and they’ve really closed the gap versus the iPhone.”
The company also added 584,000 new wireless subscribers on monthly contracts, with customers paying an average of $18.61 per month for data plans; thus marking a 19 percent increase over last year’s figures.
China Mobile plans to increase handset subsidies by almost a third this year to keep its lead as competition intensifies and the market saturates. Photographer: Nelson Ching/Bloomberg
China Mobile Ltd., the world’s biggest phone carrier by market value, posted third-quarter profit that missed analysts’ estimates as it spent more on sales promotions to win new subscribers.
Net income increased 3.5 percent to 29.6 billion yuan ($4.5 billion) from 28.6 billion yuan a year earlier, according to figures derived from nine-month earnings reported by the Beijing-based company today. Profit was expected to be 30 billion yuan, according to the average of eight analyst estimates compiled by Bloomberg News.
China Mobile plans to increase handset subsidies by almost a third this year to keep its lead as competition intensifies and the market saturates. Chairman Wang Jianzhou will start an Internet search engine next year to boost revenue after the percentage of the population with a mobile phone jumped more than sixfold to 61 percent in the past decade.
“China Mobile’s slowing earnings growth reflects a maturing of the overall mobile market,” Paul Wuh, an analyst at Samsung Securities Co. in Hong Kong, wrote in an Oct. 19 report to clients. He rates the shares “buy” and doesn’t own any.
Third-quarter sales rose 7.7 percent to 122.8 billion yuan. That exceeded the 121.45 billion-yuan average of analyst estimates compiled by Bloomberg News.
The company’s average monthly fees generated per user in the first nine months was unchanged at 72 yuan, compared with the average estimate of 72.9 yuan in the Bloomberg News survey.
More than half of China Mobile’s new users live in rural areas, where average customer spending is lower, and that is expected to narrow the profit margin, the company has said.
China Mobile fell 1.4 percent to HK$82.25 in Hong Kong trading before the earnings announcement. The stock has gained 13 percent this year.
The company, the largest mobile-phone operator by subscribers, in August named Li Yue as its new chief executive officer, replacing Wang who remains chairman.
China Unicom and China Telecom will report financial results for the period next week.
–Edmond Lococo. Editor: Vipin V. Nair, Young-Sam Cho
To contact the reporters on this story: Edmond Lococo in Beijing at email@example.com
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Microsoft Corp.’s plan to offer its Xbox Live games service on its new smartphones may not be enough to woo even the most avid video gamers to its latest attempt to stay relevant in the mobile phone business.
Microsoft unveiled its Windows 7 phones on Monday, touting the phone’s connection to Xbox Live, the online subscription service that about 25 million owners of the Xbox 360 video game console pay about $60 U.S. a year for so they can play multiplayer games online.
But some analysts are skeptical that the phones’ tie-in with the Xbox will be enough to lure gamers to the phones.
“There’s some harmony here with the Xbox, but will people really buy these phones for the games?” said Mike Hickey, a Janco Partners analyst.
Microsoft needs more exclusive game content to set the phone apart from the flood of games already available on phones that run on Google’s Android software and Apple’s iPhones, analysts said.
Electronic Arts, one of the largest video game publishers, said it would develop mobile games for the new Microsoft phones, which can be connected to users’ Xbox Live subscriptions. Players can accumulate points on their Xbox accounts by playing the EA games.
While EA’s games come from its popular mobile brands such as The Sims and Need for Speed: Undercover, many will resemble those that exist on other phone platforms.
On the new phones, users get access to their Xbox accounts, but will not be able to play console games like Halo. Microsoft must connect the phones to these console games to give it the boost it needs to rival mobile competitors, said Janney Montgomery Scott analyst Sasa Zorovic.
As Microsoft gathers financial analysts in Redmond on Thursday, the software company hopes to convince Wall Street that it’s a fast-running hare rather than a fast-aging tortoise.
So far this year, Microsoft stock has been trading like it’s a slow-growing company whose growth spurts are in the rearview mirror.
The share price fell slightly last week even after the company reported record sales, strong Windows 7 sales and encouraging early results on Office 2010 that beat expectations for the fourth quarter by a longshot.
“I would just be curious whether there is any expectation of faster growth,” Matt Rosoff, analyst at Directions on Microsoft, an independent research firm in Kirkland, said of the annual Financial Analysts Meeting. “I think Wall Street looks at Microsoft as a value stock.”
The evidence is clear in the share price compared with the company’s earnings.
Microsoft stock is trading at 12.36 times earnings, a measure frequently used to compare companies. That’s slightly higher than IBM, which is trading at a 12.17 price-to-earnings ratio.
In comparison, competitors such as Apple and Google are trading around 20 times earnings.
“Clearly there is an element of growth these investors are seeking,” said Sid Parakh, an analyst at McAdams Wright Ragen.
“If you look at Apple, the growth is higher, which is why you’re seeing these large-cap tech companies like IBM, Microsoft and some of the others trading as cheap as they are.”
Apple reported sales growth of 61 percent in the fourth quarter, compared with Microsoft’s 22 percent.
The company says it’s still got some growing to do. Microsoft is about “big, bold goals,” Chief Operating Officer Kevin Turner said this month in his keynote speech at the Worldwide Partners Conference in Washington, D.C.
Echoing Bill Gates’ earlier vision of a desktop in every home and on every desk, Turner said, “Our big, bold goal for the next couple of decades is we want to have a continuous cloud service for every person and every business.”
Cloud computing, the next technology frontier where software and data will be stored on the Internet and get accessed by multiple devices rather than living on a desktop computer, is the future for Microsoft, many executives said throughout the week. As CEO Steve Ballmer has said repeatedly this year, “we’re all in.”
Microsoft is framing it as a marathon.
“This is going to be a multiyear journey. We’re not going to accomplish this” in the next 12 months, Turner said in his speech.
“We’re going to be working on it for the next 20 years, and we’re going to make progress and you’re going to see the progress we’ve made to date is unprecedented.”
Immediate growth in the coming 12 months will be driven by Microsoft’s stalwart products — Windows 7 and Office 2010 — products that deliver massive sales in billions of predictable dollars.
The new products yet to come this year are the Kinect motion sensor for the Xbox video-game system and Windows Phone 7, the mobile-phone software aimed at making Microsoft competitive with the iPhone, Blackberry and Android.
Rosoff said he doesn’t expect Windows Phone 7 sales to move the needle on Microsoft’s revenues. Apple makes money selling the phone hardware and the software, but Microsoft will only sell the Windows Phone 7 software for phone makers to install.
“They only sell the software and it’s only $15 to $20 per unit, as opposed to Apple which is making $300, $400, $500″ per phone, Rosoff said.
At $62.5 billion in annual sales, even a blockbuster product that rakes in $1 billion in sales is only 1.6 percent of the pie.
“Clearly it’s the law of large numbers,” McAdams’ Parakh said. “Considering where Microsoft is situated, the type of growth they are delivering is pretty good.”