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Has the Innovation Curve Come and Gone for Apple (NASDAQ:AAPL)?


With the release of the iPhone 5, it's hard not to wonder if the awe is gone.

Now does this mean that Apple stock is doomed? Not in the least. To me it means that Apple can actually sell a less innovative, extremely high margin device to a mass of people and make 55-60% gross margins on it. In TechStrat, I have already stated that I expect iOS to gain share for a couple of quarters as iPhones sell very well, and then the Android share will start to surge again.

Given this, Apple will have a mammoth Q4. I think Q1 will also be very strong but we will need to see the iPad Mini for it to be another "monster." Then past Q1, I expect to see some deterioration in the phone segment.

For me, all this means that many of my prior views are being confirmed.

1. Android share is still on a path to the moon.
2. I'm finally being rewarded for swapping Google into my largest position slot.
3. I think this move of Google outperformance is just getting started.
4. I've been prudent in taking Apple out of my top-5 positions. Though I admit I did so too early.
5. And I've recently said that I think Motorola becomes the No. 2 Android seller. While very early here, I think this will be confirmed as well.
6. Lastly, if correct on the "Moto to No. 2 call", that is a huge catalyst that isn't anywhere in the Google numbers currently.

Sean Udall is the author of the TechStrat Report, a tech focused newsletter. The following is a free sample. Take a free trial!

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