Apple WWDC Preview: iCloud Steve Jobs Steve Jobs received a standing ovation at Apple's annual Worldwide Developers Conference Monday as Apple unveiled its iCloud hosted computing service. But despite Jobs' anticipated participation at the Apple (AAPL) event, his second this year since taking a medical leave six months ago, investors should not expect a huge upswing in the company's stock, says Brian Marshall, a Gleacher & Co. analyst.

In part, that's because the iCloud service and Jobs' attendance at the conference is already baked into the share price. The company announced Jobs' expected appearance at WWDC and teased the iCloud announcement last Tuesday, which gave Apple's shares a slight 3% rise to $347.83 immediately afterward.

Apple stock

But Apple wasn't able to hold onto that slight gain as the week progressed, although it did manage to fare better than the broader markets.

Apple stock and broader markets

"It is positive Steve will be in attendance and hopefully his appearance is healthy on a relative basis," said Marshall, in an email interview. "Regarding iCloud, we need to learn more but at the end of the day, it will not move the needle from a financial perspective anytime soon but should enable iOS to gain share."

Reportedly, iCloud will allow customers to store their data, such as iTunes music and movies, in the cloud, and access it from anywhere using their Apple devices. Apple, meanwhile, is reportedly in talks with four major recording studios to participate in the iCloud service.

Despite the buzz over the potential deals with the recording studios, as well as the possibility of a subscription-based model for iCloud, Apple's stock is not expected to soar as a result of today's event. Ironically, Wall Street and companies tend to favor dependable, on-going sources of revenue that come with subscription-based models that can enhance one-off sales of hardware.

"Regarding today's event, I don't expect much material action in the stock (announcements already expected). However, I do believe expectations are low and the stock is set to rise materially in the [second half of this year]," says Marshall. That's when an iPhone 4 upgrade is due, he notes. But Marshal anticipates better results from the first half of 2012, when the widely anticipated iPhone 5 should be released, designed to run on carriers' next generation Long-Term Evolution (LTE) networks.

That upgrade may help juice Apple's shares. Considering the blowout earnings Apple has been dishing out, its year-to-date stock performance has been lackluster.



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Richard

iCloud=big warehouse in North Carolina filled with computers storing ur files, just waiting to be hacked

June 08 2011 at 7:25 AM Report abuse rate up rate down Reply
Jane

Why doesnt he add flash player to the IPAD? It is ridiculous!

June 07 2011 at 1:30 PM Report abuse +2 rate up rate down Reply
1 reply to Jane's comment
sevnwolves

Because Adobe bought it out from under him. See - the then owners of Flash know that Adobe has far more market in Windows based aplications, so they sold it to them. Jobs is a spoiled little brat and he's still throwing a temper tantrum over it.

June 07 2011 at 7:44 PM Report abuse rate up rate down Reply
noah

Apple Sux just like Walmart does. They try to force out competition (monopoly) then raise the prices on services and products. I also grew tired of Apple coming out with a "newer" version of their products every six months. All they are interested in is squeezing out every penny they can from their loyal consumers. In my opinion, they don't deserve that loyalty.

June 07 2011 at 11:57 AM Report abuse +2 rate up rate down Reply
Sekinu2

Hmmm although the cloud idea is alread a giant failure with massive outages and lost business days apple decides to follow microsoft. I do wonder how long the name will last as this is obviously infringment as Microsofts patent and trademarks on the concept and names were filed way before apple even started concept of following but as is apples way they don't trend set just redo and adapt others ideas.

June 07 2011 at 11:50 AM Report abuse rate up rate down Reply
pete

Before "the Bush depression" apple averaged about $200 per share for the prior year. When the economy, run by democrats controlling Congress, dumped, Apple was $212. It bottomed at $84.88. When the chaff was separated and the market came back Apple peaked at $368 per share. For about a year now it has been averaging well over $300. Today, right now, it's $334.

June 07 2011 at 11:16 AM Report abuse -3 rate up rate down Reply
Edie

Apple products are beautiful but the company does not respect its customers.

June 07 2011 at 11:09 AM Report abuse rate up rate down Reply
2 replies to Edie's comment
Sekinu2

Ummm they are far from beautiful. All thier macs and ipod/iphone products are very ugly ikea looking devices that lack any character or personality. thats like saying a white room with white boxes as furniture are beautiful lol Apple sucks but makes good ahrdware which they over price for the people dumb enough to pay 6 times the value.

June 07 2011 at 11:53 AM Report abuse -1 rate up rate down Reply
sevnwolves

They sure don't - have something glitch out and their response may as well be "tough luck, we got your money, go away"

June 07 2011 at 7:46 PM Report abuse +1 rate up rate down Reply
rdins4

Summer is always a down time, but it's a good time to get a position before the Christmas season.

June 07 2011 at 8:16 AM Report abuse +1 rate up rate down Reply
Akbar Merchant

I was surprise by the fall of AAPL stock, Holding them since 10 dollar up movment a week ago, Seeing some changes on iCloud announcement, but things didnt work according to plan. Hope to see some postive up a day after as i have a betting going on options. It has to reach the mark of 355.00 by third friday of the month only than ill make some money,

June 07 2011 at 3:07 AM Report abuse -1 rate up rate down Reply
Ed

The WWDC announcements today are huge, and will boost iOS devices substantially. Why? Because most of the additional features today enhanced a closed system that the consumer will want to be part of. For example, if coworkers are sharing files with AirDrop, you'll want to be able to, too. If others are on iMessage, you'll want to be on it, too. If your family schedules things on a calendar, you'll want an iOS device to sync the calendar, too. If your family is sharing pictures or music, you'll want an iOS device so you can see the photos or movies or music, too.

Today's announcement will take iPhone viral.

June 07 2011 at 12:59 AM Report abuse rate up rate down Reply
Gumby

AAPL is already worth $330 billon while AAPL annual sales is less than $100 billon... AAPL is not going to repeat the torrid growth it enjoyed in the last few years let alone hold on what it has gained... AAPL is already at lofty valuations that is almost herculean to maintain .. Microsoft did hit over $500 billon only briefly before heading south ever since. Exxon Mobil is about $400 billon in valuation.. compare AAPL and XOm for all I care!1

June 06 2011 at 6:29 PM Report abuse -1 rate up rate down Reply