CHICAGO, Jan. 13, 2012 /PRNewswire/ -- Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include Apple Inc. (Nasdaq: AAPL) and Google Inc. (Nasdaq: GOOG).
Get the most recent insight from Zacks Equity Research with the free Profit from the Pros newsletter: http://at.zacks.com/?id=5513
Here are highlights from Thursday's Analyst Blog:
Apple Buys Anobit
Confirming earlier rumors, Apple Inc. (Nasdaq: AAPL) bought Israeli flash chip-maker Anobit Technologies Ltd. on January 6. According to Bloomberg, Apple dished out $390.0 million for Anobit, less than the rumored figure of $400.0 to $500.0 million. However, Apple declined to disclose any further details about the transaction.
The acquisition is in line with Apple's strategy of acquiring small start-ups, which have historically been quintessential for its business growth. Traditionally, Apple has focused on acquiring software-based companies. This is only the third hardware company that Apple acquired in its history; the other two being P.A. Semi in 2008 and Intrinsity in 2010 for $278 million and $121 million, respectively.
Other than the supply of flash storage solutions, Anobit also offers Memory Signal Processing (MSP) technology, which improves the performance of flash storage products and systems and also makes them cost effective. Apple already uses Anobit chips in its iconic iPhone, iPad and MacBook Air devices. Anobit also supplies flash chips to Samsung and Hynix. Incidentally, Hynix is one of the main flash memory suppliers for Apple's iPhone 4S.
The acquisition will enable Apple to boost the memory volume. It is also expected to boost performance of its devices going forward. Moreover, the MSP technology acquired by Apple is expected to differentiate its devices from competitors such as Samsung. Therefore, there is a possibility that Anobit will stop supplying chips to Samsung, which would strengthen Apple's position versus one of its key competitors in the smartphone segment.
Most importantly, we believe that the Anobit acquisition facilitates the in-house chip procurement process for Apple, which will significantly lower costs going forward. We note that the demand for Apple's devices generally rise when it launches a new upgrade and during the holiday seasons. However, it is very difficult to estimate this sudden increase in demand. We believe that the in-house development process will help Apple meet the sudden surge in demand for its popular devices going forward.
We believe that the acquisition will not only provide Apple a talented workforce but could also lay the foundation for future research & development activities in this low-cost region.
As we believe that Apple's ability to spur the popularity of its products in developing nations, where pricing is often an important consideration, will go a long way toward deciding the company's future growth, setting up local research & development facilities will help the company to maintain its margins over the long term.
Apple has been a leader in the technology space and has always wooed its investors with its innovative product line. We believe that Apple remains the biggest growth story in the tech industry primarily attributable to its superior product pipeline, Apps, iCloud, the upcoming iPad update, the loyal customer base and international expansion going forward. Moreover, strong holiday season sales will drive upside in the near term.
However, stiff competition from Samsung and Google Inc. (Nasdaq: GOOG), the overcrowding in its major markets and increasing legal complexities are the main concerns. We also believe that Apple's secretive approach makes it very difficult to assess the company and this lack of visibility induces us to remain on the sidelines.
We maintain our Neutral recommendation over the long term (6-12 months). Currently, Apple has a Zacks #2 Rank, which implies a Buy rating in the near term.
Want more from Zacks Equity Research? Subscribe to the free Profit from the Pros newsletter: http://at.zacks.com/?id=5515.
About Zacks Equity Research
Zacks Equity Research provides the best of quantitative and qualitative analysis to help investors know what stocks to buy and which to sell for the long-term.
Continuous coverage is provided for a universe of 1,150 publicly traded stocks. Our analysts are organized by industry which gives them keen insights to developments that affect company profits and stock performance. Recommendations and target prices are six-month time horizons.
Zacks "Profit from the Pros" e-mail newsletter provides highlights of the latest analysis from Zacks Equity Research. Subscribe to this free newsletter today: http://at.zacks.com/?id=5517
Zacks.com is a property of Zacks Investment Research, Inc., which was formed in 1978 by Leon Zacks. As a PhD from MIT Len knew he could find patterns in stock market data that would lead to superior investment results. Amongst his many accomplishments was the formation of his proprietary stock picking system; the Zacks Rank, which continues to outperform the market by nearly a 3 to 1 margin. The best way to unlock the profitable stock recommendations and market insights of Zacks Investment Research is through our free daily email newsletter; Profit from the Pros. In short, it's your steady flow of Profitable ideas GUARANTEED to be worth your time! Register for your free subscription to Profit from the Pros at http://at.zacks.com/?id=5518.
Visit http://www.zacks.com/performance for information about the performance numbers displayed in this press release.
Follow us on Twitter: http://twitter.com/zacksresearch
Join us on Facebook: http://www.facebook.com/home.php#/pages/Zacks-Investment-Research/57553657748?ref=ts
Disclaimer: Past performance does not guarantee future results. Investors should always research companies and securities before making any investments. Nothing herein should be construed as an offer or solicitation to buy or sell any security.
SOURCE Zacks Investment Research, Inc.