Edible Apple

After meeting with Apple COO Tim Cook and Apple CFO Peter Oppenheimer, Mike Abramsky issued a research note highlighting a few of his takeaways with two of Apple’s top executives.

Though the note contains no direct quotes from either Cook or Oppenheimer, Abramsky intimates that both men see China as a massive opportunity with a “significantly untapped” market. This of course is no surprise. Just recently we highlighted some of Cook’s remarks regarding China from Apple’s earnings conference call.

China was very key to our results. As a reminder, for Greater — we define Greater China as Mainland China, Hong Kong and Taiwan — year-over-year it was up over six times. And the revenue was approximately US$3.8 billion during the quarter, and that makes the year-to-date numbers through the three quarters that we have had thus far around $8.8 billion. So this has been a substantial opportunity for Apple. And I firmly believe that we are just scratching the surface right now. I think there is an incredible opportunity for Apple there.

Notably, there have been rumors of Apple releasing a low cost iPhone alongside a new iPhone 5 in an effort to appeal to a broader market. To that end, Abramsky writes that “Apple’s primary criterion for launching a lower-end iPhone is an innovative, category-killer experience.”

Also of note is that because China is such a desirable market teeming with the potential to earn billions, Ambramsky relays that Apple may be more willing to settle with Android handset manufactureres “rather than seek to bar them, in order to set itself up with favorable agreements in countries such as China that have less rigorous intellectual property rules.”

Lastly, Abmramsky puts a $500 price target on Apple shares, which as we highlighted yesterday, remain extraordinarily cheap relative to its P/E ratio.

via Barrons