So far we are only 3 months into 2013, and the Galaxy S4 is already the most talked about and anticipated device of the year. But that shouldn't surprise anyone. Now an analyst is saying that the Galaxy S4 could have a negative impact on Samsung's stock. This analyst must be smoking the good stuff….just kidding.
Adnaan Ahmad who is from Berenberg Bank has already changed his advice on Apple stock from buy to sell, but he has also changed his view on Samsung's stock. Yes you read that right, Ahmad is advising Samsung shareholders to sell. He delivered a 60-page report on the smartphone industry, and dedicated part of it to the upcoming Samsung flagship device of 2013, the Galaxy S4, which will be unveiled next week. Ahmad believes that the Galaxy S4 could be Samsung's "iPhon5 moment" for the South Korean company.
So what does Ahmad mean by "moment"? Well right after the iPhone 5 was announced last September, Apple's stock peaked. After that peak, Apple's share price has fallen significantly even though they are still selling millions of devices, including the iPhone 5 which brought in even more revenue and profits than before. Ahmad is expecting the Samsung stock to go down in the months following next week's announcement, as always it'll be interesting to see whether he is right or wrong about this "moment":
[…] learning from our Apple experience, the Galaxy S4 launch could be Samsung's iPhone 5 "moment" – when the Apple stock peaked. The S4 should have a better processor (Exynos Octa chip) and improved display (potentially larger/flexible) but how much better can it really be? Samsung, as we have written extensively in the past, has a significant advantage over its peers as it has a 12-18 month lead on AM-OLED display technology. This technology allows for the screen to potentially be flexible and foldable. We do not think that flexible is a big differentiating factor, whereas foldable probably will be in the future. However, foldable screens are still 18 months away at least. In the interim, mega bulls on the Samsung stock are going to be hoping for a) market share gains versus Apple at the high end; and b) better margin structure than our estimates on the mid-to-low-end portfolio. – We can say with confidence that Samsung's H1 2013 results will be robust given the S4 release and subsequent sell-in to the market. However, we think that – as with Apple – investors will quickly start to look beyond H1 2013. Hence any near-term strength in the stock for us is an opportunity to sell down positions.
Then there's always that report that says Samsung is expecting to sell 100 million Galaxy S4 units this year. Along with another report that Samsung is preparing to move 10 million units each month. So how will this all affect Samsung's stock? Well we will just have to wait and see now won't we?
But in the meantime, be sure to keep your browsers locked to Android Headlines. We'll be bringing you every detail of the Galaxy S4 up to the announcement next Thursday along with everything else until the device finally launches in the the US. Don't forget, we'll be doing a special Galaxy S4 AH Show as well. We'll keep you posted on the details regarding that show.
How many of you are excited about the Galaxy S4? Hit up the comments below and let us know.