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In keeping with the spirit of Black Friday, Apple (NASDAQ:AAPL) has announced discounts on several of its products, including even the latest fourth-generation iPad with Retina display along with the iPad 2. However, one of the company’s other young products, the iPad mini, has not received a discount. According to Wells Fargo analyst Maynard Um, who has an Outperform rating on Apple shares, the lack of discounting on the smaller tablet may be a clue that Apple is seeing sufficient demand for the device.
What led Um to make his assertion on the iPad mini?
“Unsurprisingly, Apple is not offering any Black Friday promotions for its iPad mini given end demand,” the analyst wrote. “Ship times remain two weeks for both the Wi-Fi and 3G models. We believe iPad Mini is proving to be a must-have holiday item and while we expect lower priced competitive tablets to draw attention as well, we note that we do not expect Apple to maintain its dominant unit share though do expect it to dominate profit share.”
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Um added that he expected Apple to meet or exceed the firm’s prediction of sales of 20.2 million iPads in the December quarter.
How Will This Analysis Affect Apple’s Stock?
One of the bigger reasons for the recent fall in Apple’s stock price has been the worry that the company has not been able to meet the high consumer demand with sufficient supplies. While Um’s analysis is solely demand-based, it does highlight Apple’s business acumen and the suggestion that the company is doing anything it can to come to a supply-demand balance. It also eases, at least in the short term, worries about profit margins. According to the analyst, iPad sales will help Apple dominate the tablet market’s profit share this quarter.
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