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What to Expect From Apple in the Second Half of 2012

Tamara Rutter
July 28, 2012

Apple (Nasdaq: AAPL  ) has endured a wild ride so far this year. By now you're probably aware that the tech giant missed analyst estimates on Tuesday, when it reported third-quarter earnings. Shares tumbled more than 5% on the news. However traumatic this may seem for current shareholders (myself included), investors should consider the handful of key growth catalysts in this name before joining the bears in a rush to sell.

Tracking where a company has been can offer valuable insights into the future. Now that we're midway through fiscal 2012, let's take a closer look at where the Mac maker was six months ago and where it's headed in the second half of the year.

Keep 'em guessing
Shares of Apple kicked off the year trading around $400 a pop. Today, those same shares are worth about $585 apiece, down from a 52-week high of $644. Yet even off its recent high, the stock is up nearly 45% year to date -- that's not bad for the world's most valuable company. But how has the stock performed thus far compared with industry rivals?

AAPL Total Return Price Chart

AAPL Total Return Price data by YCharts

Apple is undoubtedly on a tear this year, despite its recent earnings disappointment, perhaps because many bulls understand that the tech titan is in the process of a product transition as it readies for the upcoming debut of its iPhone 5, as well as a smaller and cheaper iPad device. Of course, there's also the rumored Apple TV on the horizon. With so much to look forward to in the coming months, it's hard for me to justify being disappointed over one less-than-stellar quarter.

Outsized expectations
Obvious as it may seem, many consumers are postponing the purchase of a new smartphone until the iPhone 5 hits shelves this fall. I have no doubt this consumption delay contributed to the recent weakness in iPhone sales. Apple sold 26 million iPhones in the quarter, while the street was expecting unit sales north of 28 million.  

Today, iPhone sales generate a significant portion of Apple's revenue. Yet it's more important than ever that the company's next-generation device live up to the hype. Competition in the space is nothing to take lightly. Consider how quickly Research In Motion (Nasdaq: RIMM  ) went from being the leader in smartphones to an outdated and technical mess.

In fact, the BlackBerry maker is at the bottom of the barrel in terms of market share. Even mobile-handset maker Nokia (NYSE: NOK  ) looks to have a better shot at a recovery than RIM. In the second quarter, the Finnish company sold more than 10 million smartphones. Meanwhile, Samsung took home the gold with 50.2 million in the three-month period, followed by Apple's 26 million.

Not to worry. There's plenty of growth left in Apple's future, despite Samsung's current lead in the smartphone space.

Innovative product lineup
What really matters for investors is that the iDevice maker's profit climbed $1.5 billion from the same period a year ago, not to mention that the 17 million iPad sales in the June quarter were indeed a new record for the Mac maker. That's an 84% increase in iPad deliveries over the year-ago period.

The most powerful companies in the world all share in their ability to keep people guessing. This is a