Q4 Predictions: Kindle on Fire, iPhone a Hit, More Netflix Trouble, and Less S&P Turmoil

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It's been a wild quarter and a volatile year, and we're not done yet.

The final quarter of 2011 promises to be just as exciting -- and frustrating -- as the first nine months of the year have been for Wall Street. I'm not afraid to go out on a limb and make a few calls, so let's go over a few things that I see playing out over the next three months.

1. The Kindle Fire will be a hit
Amazon.com
(AMZN) introduced its new entry-level tablet this week, but Kindle Fire won't hit the market until mid-November. CEO Jeff Bezos has promised to put out "millions" of these, and consumers will buy them.

The $199 price point is the real driver here. Sure, it lacks many iPad 2 features -- there's no camera or microphone, and the screen is smaller. It's only Wi-Fi, and folks can't pay $130 more for a 3G version, like they can with the iPad.

However, between pricing it right in this iffy economy and Amazon's digital multimedia ecosystem serving up video, music, e-books, games, and apps, this will be the hot tech gadget of the 2011 holiday shopping season.

It won't kill the iPad. It may not even threaten the iPad. Kindle Fire will simply widen the audience of tablet users, and that's good for both companies.

2. The iPhone 5 will be a hit
Apple
(AAPL) plans to pull the wraps off the iPhone 5 next Tuesday; it should be available in stores a few days later. This prediction may seem like a no-brainer, but there are a few reasons why some are skeptical.

Apple is already late with its annual update. The world's most valuable tech company typically puts out a new iPhone early in the summer. The Android platform has also taken over as the mobile operating system of choice since the iPhone 4 was introduced 15 months ago.

Apple also isn't perfect, even these days, when nearly everything it touches turns to fiscal gold. The Apple TV has failed to take off. iPod sales have been shrinking in recent quarters. And after Steve Jobs' surprising retirement this summer, Apple also won't have its charismatic co-founder marketing the magic.

None of this will matter. Consumers will still want the new smartphone. It reportedly will come with a better camera, more powerful processor, and beefed-up speech recognition. Sprint (S) will also likely become the third stateside carrier to offer the iPhone, giving consumers a cheaper wireless company and one that's still offering unlimited data plans to new customers.

3. Netflix will continue to shed domestic subscribers
Earlier this month, Netflix (NFLX) warned that it will have only 24 million stateside subscribers by the end of the third quarter, short of the 25 million it was originally targeting and the 24.6 million it watched over at the end of June.

The flick flinger's reputation has taken more body blows after that original announcement, so it wouldn't be a surprise to see the net defections continue during the current quarter -- translating into fewer than 24 million subscribers by the time Netflix announce its financials in late October.

I expect some of that weakness to carry over into the fourth quarter.

I should climb out a little more on the limb -- predicting that Netflix's net accounts will actually increase for 2012 -- but I do see back-to-back sequential quarterly declines to close out 2011.

4. Stocks will close out the quarter in positive territory
After a positive first quarter and flattish second quarter, stocks have taken a pounding in recent months. The S&P 500 is down by more than 8% year-to-date as the European debt crisis and stiff unemployment rates closer to home weigh down consumer confidence.

Longtime investors know the drill: The market is never as great as it seems when stocks are rising, and it's never as bad as it seems when share prices are falling.

Do I think the S&P 500 will surge by 9% this quarter, pushing 2011 returns out of the red? Not necessarily. I may be an optimist by nature, but I'm no Pollyanna. However, I see the contrarian allure of buying now, when so many are selling.

Stocks may not climb 9% over the next three months, but they are more likely to gain ground than repeat the third quarter's slide.

This would be an easier call to make if Europe were in better shape and there were more hiring than layoff announcements in this country, but consumers are due for a break as we head into the holidays. They will get it.

Longtime Motley Fool contributor Rick Munarriz does not own shares in any stocks in this article, except for Netflix. The Motley Fool owns shares of Apple. Motley Fool newsletter services have recommended buying shares of Apple, Netflix, and Amazon.com, as well as creating a bull call spread position in Apple and a bear put spread position in Netflix.



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11 Comments

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Morris Cantonitis

38,000 more to Occupy the PIGGS Den.

They understand the word "vitrication" in their home state.

Who has the shroom? Who has the shroom?

Satan will drive U crazy looking.

NYC GETS NUKED

September 30 2011 at 11:32 AM Report abuse rate up rate down Reply
Morris Cantonitis

The US PIGGS play against Daarck Knight portfolio and America suffers -

Apple, CAMP, NVIDIA, EGHT, WFC, ETFC will NEVER EVER POP as the PIGGS at the SEC and ***** FED recite.

3 of Satan's Sites

Fidelity, Wells Fargo & E-Trade.

Satan's inbred PIGG disciples.

Their children have been Marked. Satan chokes their pre-born in the womb with the umbilical cord and yanks them out for a fine #1 pork barbecue hot n spicy feast is how he and his disciples prefer.

and WE RECITE

NYC GETS NUKED

September 30 2011 at 11:12 AM Report abuse rate up rate down Reply
Morris Cantonitis

Satan performs ******** on the FED Reserve PIGGS and SEC TODAY as preparation H Bomb.
The same incestual sex the BEASTS have with criminal shorting and derivatives.

NYC GETS NUKED

September 30 2011 at 10:23 AM Report abuse rate up rate down Reply
Morris Cantonitis

Satan prepares the FED Reserve, SEC and Wall Alley PIGGS.

Shake Buildings Shake
Fall Buildings Fall

When the PIGGS are DEAD America stands Tall.

September 30 2011 at 10:14 AM Report abuse rate up rate down Reply
Morris Cantonitis

What to expect from the Wall Alley PIGGS, SEC & Fed ***** Reserve.

A 1000 point gain in Market to Feed "members only' who know about it.

NYC GETS NUKED

September 30 2011 at 10:10 AM Report abuse rate up rate down Reply
Morris Cantonitis

Albeit, China. Most Americans know U as a Communist PIGG.
But America is the best at parasitic leeching illusionary shorting of monetary.
Watch your tech stocks fall because of Wall Alley, SEC and FED Reserve CORRUPTION.
U have the bullets to short all the American banks such as Wells Fargo PIGG and buy them out and take them over.
Your choice.
NYC GETS NUKED

September 29 2011 at 7:37 PM Report abuse -1 rate up rate down Reply
Morris Cantonitis

It all worked well when the 2 legged abided by the honor system and FEARED recourse.
But then America accepted Satan to launder the world’s savings through their perverse shorting and derivatives.
U do not fool anyone SEC and FED Reserve PIGGS and NYSE MM PIGGS.
America takes back HONOR Dead or Alive.
The Kingdom of Christ gives U PIGGS a dis honorable discharge and
NYC GETS NUKED

September 29 2011 at 6:56 PM Report abuse -1 rate up rate down Reply
Morris Cantonitis

Do U like China the way the Khuzami/Nester PIGGS targets U for corruption?

China, Russia, N. Korea NUKE the PIGGS at the Federal Reserve and SEC for they follow SATAN AND ARE corrupt.

It is the American PIGG that is far more advanced with the Markets and they set U up and want the finger pointed ANYWHERE but at the fleecing PIGGS that shorted the world's savings DOWN criminally.

Daarck Knight has been into the SEC and FeD Database. THIS IS WHERE THE PIGG hides with it’s Hedge Funds.

NYC GETS NUKED.

September 29 2011 at 6:35 PM Report abuse -1 rate up rate down Reply
Chris Peraino

Netflix will be lucky to have more then 20 million subcribers by the end of December, what are they talking about 24 million?? Time to rethink your holdings, watch out for a company that only screws it customers... and then saids, I'm sorry???
This stock & company is a dead horse, watch out for the CEO, he's going to rise the prices again. He made the farm, let him lay down with the pigs!!!

September 29 2011 at 2:57 PM Report abuse rate up rate down Reply
Morris Cantonitis

The Wall Alley PIGGS List:
Bounties on ALL and Sentencing from Satan
1. Flash Crash –
SEC, Fed Reserve, Brokerages and Wall Alley NYSE PIGG MM’s – Guilty
2. Hedge Funds, the SEC and Fed Reserve CONTINUE to generate imaginary shares and SHORT the world’s markets AS NEEDED. The US CONTINUES to adopt PIGG Derivatives & Shorting for the PIGG – Guilty on ALL counts.
3. Membership Only Trading PIGGS – Wall Alley MM PIGGs move the money so only they and their friends, 1% of the population, can profit – Guilty
4. Slowing down of IP’s for traders – PIGG Brokerages such as Wells Fargo – Guilty
5. PIGG MM’s churn the market as needed with their software to RAPE the world - Guilty

NYC GETS NUKED

September 29 2011 at 1:31 PM Report abuse rate up rate down Reply