X Apple (AAPL) bears this week knocked the company's HomePod smart speaker for being late to market, a copycat product and a sign that Apple lacks innovation.
But you should ignore them, says Argus Research analyst Jim Kelleher.
The HomePod should satisfy Apple fans and keep users in its ecosystem of hardware and services, Kelleher said in a report Wednesday. Kelleher reiterated his buy rating on Apple stock and raised his price target to 175 from 160.
"Apple bulls argue that new offerings play to the strengths of Apple's enormous and unmatched installed base, while bears argue that Apple lacks visionary products and is reduced to playing catch-up," Kelleher said. But "being first has never been Apple's strong suit. Coming late to the party did not hurt iPhone's leadership in smartphones."
Apple stock dipped 0.2% to 154.99 on the stock market today.
Apple traditionally has waited for a market to develop and learned from the mistakes of rivals before introducing its own version. It did that in the MP3 player market with the iPod, the smartphone market with the iPhone and tablet market with the iPad.
Apple has positioned HomePod between high-quality speakers from the likes of Sonos and digital home assistant speakers such as Amazon.com's (AMZN) Echo speaker and Alphabet's (GOOGL) Google Home device, Kelleher said.
"The Apple HomePod is being positioned first as a smart music player and secondarily as a Siri-enabled digital home assistant," he said. "Apple's iTunes store and its Apple Play music service create an instant and vast potential audience for HomePod."
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At $349, HomePod is much more expensive than the standard version of Amazon Echo at $180 and Google Home at $129. But HomePod boasts superior sound quality for music playback. Sonos speakers range from $199 to $499.
More iPhone 8 Delay Chatter
Meanwhile, RBC Capital Markets turned its attention to Apple's upcoming iPhone 8 launch this fall.
RBC analyst Amit Daryanani lowered his iPhone sales forecast for the September and December quarters, based on evidence of production delays for the OLED-display iPhone 8. Apple also is expected to introduce two new LCD screen smartphones this fall that are upgraded versions of its current handsets that likely will be called the iPhone 7S series.
"While we still think Apple launches all three models simultaneously in September, the OLED model will see limited availability or delayed availability till mid-October/November time frame," Daryanani said in a report Wednesday. "Furthermore, we think a shift in OLED production by one to two months doesn't change the demand dynamics for iPhones (fairly captive demand) or undermines the positive iPhone upgrade cycle narrative."
Daryanani reiterated his outperform rating on Apple stock with a price target of 168.
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