Apple’s Let Down

RingTone News Isn’t Breaking Any Barriers

By Bryan Bottarelli
Wednesday, September 05, 2007 1:44 PM EDT
Wed, 5 Sep 2007 17:44:00 GMT

Dear Bottarelli Research Member,

Talk about a let down! Steve Jobs just announced that Apple’ s iTunes music service will now allow songs to be made into iPhone ring tones for $0.99 each. Given the amount of media hoopla that Apple caused leading up to this announcement, it’s not surprising that the stock quickly fell over $3.00 on this news. After all, investors are used to Apple breaking new technology paradigms with their announcements — but this one was sure a stinker.

AAPL

At the same time, NBC Universal just announced that they’ve agreed to sell downloads of shows such as Heroes and The Office on Amazon’s (AMZN – NASDAQ) Unbox digital download service, replacing a similar arrangement with Apple’s iTunes downloading service. This has extended Apple’s intra-day losses, but that simply means that bargain hunters could come in and buy into any weakness.

At any rate, this disappointment from Apple hasn’t done much to effect shares of Garmin, which are still holding strong in the midst of an overly-bearish market day. So let’s continue to maintain our GRMN October 105 Calls (RZJ JA) for further upside leading into the close of the trading week.

GRMN

Come tomorrow, we could have yet another opportunity to add calls on stocks that gapped down this afternoon. After all, if the recent directional trends hold, tomorrow looks to be a strong up-day. So as always, we’ll look to trade the intra-day volatility in the best possible way, and that involves carrying a balance of both upside calls and downside puts.

Lock and load!

Sincerely,

Bryan Bottarelli

Bryan Bottarelli
Editor, Bottarelli Research

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