As Wall Street continues to climb back toward heights not seen since October 2007, shares of Apple aren't caught up in the momentum. As of this writing, shares continue to hover at or around $450 - an abysmal price considering where the stock was trading (north of $700) just a few short months ago.
"The big question we get from investors is whether the greatest turnaround and growth story of the past decade is over?" asks Sterne Agee's Shaw Wu in a note to investors released this morning. Wu, however, didn't wait long to answer his own question.`
In short, Wu doesn't believe Apple's best days are over, but that more needs to be done for the company to recapture its lost "mojo." For starters, Apple needs to creatively modify some of its leading products.
"We believe AAPL is leaving money on the table by not participating in larger touchscreen form factors," Wu writes. "But more importantly, we believe AAPL needs to reclaim high-end leadership as that is what brand is about. Sure, iOS, iTunes and the App Store are great, but it is clear that many customers want larger screens."
"In many markets, the 4.8- inch (Samsung Galaxy S III) to 5.55-inch (Galaxy Note II) form factors are the new high-end of the market where the iPhone 5 is viewed as mid-range but with a high-end price."