Now that investors have digested another record quarter from Apple Inc., the focus shifts to the iPhone maker's scheduled event this Wednesday, when cross your fingers, a new tablet version of the Mac is introduced.
"Given high expectations, near term valuation volatility around Apple's Jan 27 event may offer accumulation opportunities," said Mike Abramsky, analyst, RBC Capital Markets.
Aside from the expected "wow" factor should the new tablet be introduced, Mr. Abramsky thinks investor sentiment will be driven by the new gadget's price point. A range between US$500 to US$700 represents the "sweet spot."
He thinks the perceived scope of the tablet will also be an important driver, with success dependent on broad cooperation from disrupted content providers, including news, books, music.
If the tablet is considered a niche product, it implies sales of roughly $1-million units, A "hit" product, however, would see more than $10-million units sold per year.
"A "hit" would could provide a possible new growth engine for Apple," said Mr. Abramsky.