[Article for The Motley Fool.]
Have you been giving some thought to getting a tablet? If your technology is aging and in need of an upgrade, this might be the year to consider asking for a new tablet under the tree this holiday season.
Tablet sales continue closing the gap on traditional PC’s. Tablet shipments are expected to grow 53.4% this year, with shipments reaching 184 million units, according to Gartner analysts. PCs, on the other hand, are falling precipitously. The real question that investors want to know is how to play this growing market. Here are a couple of trends you want to be aware of.
Apple is losing tablet market share
Apple (NASDAQ: AAPL) set the standard for tablets, but their market share fell to 29.6% in the third quarter, its lowest share to date. With no iPad product launches in either the second or third quarter driving volume, Apple experienced a quarter-over-quarter decline in shipments from 14.6 million during the second quarter to 14.1 million in quarter number three.
However, CNET is calling their new iPad Air “the best full-size consumer tablet on the market.” Of course, the bar is now set quite high for Apple; as the market continues to shift by offering more and increasingly sophisticated alternatives at far cheaper prices, their new tablet had better be good.
Chances are the new iPad will be finding its way into many shopping carts come Black Friday. In fact, several major retailers , including Target, are announcing a host of Apple discounts and deals on one of the biggest retail days of the year. They will be selling the new 16GB iPad Air with Wi-Fi for $479, a savings of $20 off Apple’s own price, plus they’re giving away a $100 gift card with every full-size iPad purchase, $75 for every iPad mini, $50 for the 16GB fifth-generation iPod touch and $30 for any iPhone 5s.
Rise of the Androids
Samsung (NASDAQOTH: SSNLF), now firmly positioned behind Apple, has been dominating the Android market; their new Galaxy Note 10.1 tablet that stacks up well with Apple’s full-size iPad, plus it’s got some extra bells and whistles. If processing capability is what you’re after, then Samsung may be your model — if you’re not done in by sticker shock of the $549.99 price tag for the 16 GB model or $599.99 for the 32 GB version.
Samsung is the world’s largest smartphone maker. As such, the company has been able to amass a $50 billion pile of cash. Not all shareholders are happy about that, as some investors had higher expectations for the company, including a bigger increase in the dividend, or possible news of substantial stock buybacks, which are apt to lift share prices by increasing the ownership stake of the remaining shares that are publicly held.
Booksellers and tablets
Barnes & Noble (NYSE: BKS) is jumping right back into the tablet pond with its latest version of its Nook, the Nook HD+, starting at only $149.00 for the 16 GB version. The device has has a sharp screen, solid performance, and a microSD slot. It’s also lightweight, comfortable, and magazines and catalogs display better than any other tablet, according to CNET’s Eric Franklin . The downside: no camera, a screen susceptible to fingerprints, and an OS that can feel sluggish at times. But, did I mention it’s only $149.00?
Not to be outdone by their book counterpart, Amazon (NASDAQ: AMZN) is also hot-to-trot on the tablet front. Their Kindle Fire HDX 8.9 is a media consumption monster. A great value and all the great Amazon Kindle features fans have come to expect from the book-selling behemoth.
As book sellers, both recognize the shifting nature of the landscape they inhabit. This continues to be of particular concern for Barnes & Noble, whose stock price lags Amazon’s considerably.
From Barnes & Noble’s Letter to Shareholders in their 2013 Annual Report , company founder and chairman, Leonard Riggio wrote, Our bookstores had a solid year, with a 16% increase in earnings before interest, taxes, depreciation and amortization (EBITDA).
The company continues its commitment to responding to dynamic changes in the book selling industry; one of the ways it is doing so is expanding its distribution channels through strategic partnerships with world-class hardware and software companies, like it did with Microsoft .
Amazon reported third quarter earnings last month, and the stock spiked as the company beat Wall Street expectations on revenue. Amazon has continued trending higher, with the stock up more than 40% in 2013. Is Amazon overvalued?
Bespoke’s Paul Hickey doesn’t think so. He thinks Amazon’s ability to deliver goods seven days a week is a key to their journey toward retail.
So there you have it. There are a variety of tablet options out there. With the holiday buying season just around the counter, and a wealth of options available, the holidays might be the right time to find the tablet you’ve been jonesing for.
Fool contributor Jim Baumer has no position in any stocks mentioned. The Motley Fool recommends Google and OpenTable. The Motley Fool owns shares of Google. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.