Samsung Galaxy S4 Just Confirms that Apple (AAPL) is a Dead Man Walking - Analyst

March 15, 2013 9:18 AM EDT
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Analysts are out trashing Apple (NASDAQ: AAPL) today following Samsung Galaxy S4 announcement in New York last night.

"While clearly a step forward relative to the S3, there is much that is evolutionary about the S4, rather than revolutionary," Nomura Securities Stuart Jeffrey said. "Nevertheless, we see the S4 potentially helping Samsung to overtake Apple in high-end smartphone shipments during 2013."

The firm's initial thoughts on the Galaxy S4 include:
  • Derivative form factor – the S4 looks rather similar to the S3 and sustains Samsung use of plastics as the main backing material.
  • Some compelling new features, although some will only work with other S4s or new Samsung TVs, arguably limiting their appeal.
  • 35-40m high-end S4 and Note sales per quarter seems feasible, which would see Samsung overtake Apple in terms of high-end volumes.

    "We do not expect the S4 to materially change the competitive landscape in developed markets, where Apple’s brand and device and app ecosystem sustains its leadership," Jeffrey said. "However, the large screen size clearly appeals in many Asian markets and is a clear differentiation in Western markets as well. Also, some features such as Air Touch, eye tracking that pauses running apps when you look away, the ability to operate the screen with gloves, etc. are all clear differentiators relative to the iPhone."

    The analyst is concerned whether or not Apple’s management changes have disrupted the company’s ability to materially advance iOS with the likely release of iOS7 in June. The firm's checks also suggest that the company is not working on a 4.5” to 5” device for launch in 2013. "If correct then Apple’s competitive position in fast growing emerging markets could continue to wane, and Samsung may become a bigger threat still in Western markets," he said. "More importantly still, we see a risk that Apple and Samsung have to increasingly compete against one another to drive growth – rather than rely on the failings of rivals –resulting on pressure for share gains and increased price-based competition.

    The firm maintained a Neutral rating and price target of $490.00 on Apple.

    For an analyst ratings summary and ratings history on Apple click here. For more ratings news on Apple click here.

    Shares of Apple closed at $432.50 yesterday.

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    Nomura, S3


    Bigger screens
    Jessie on 2013-03-15 23:08:28
    Mark as Spam | Reply to this comment

    The screen size is way too small. Only 5". Samsung, we need bigger screens with every release

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