UPDATE 1-CS reinitiates IT hardware sector with "market weight"
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Aug 8 (Reuters) - Credit Suisse reinitiated coverage of the information technology hardware sector with a "market weight" and rated Apple Inc (AAPL.O) and Dell Inc (DELL.O) "outperform", saying the PC market is performing better than the wireless market, while it is less optimistic on the printer market.
The brokerage also rated EMC Corp (EMC.N) "outperform" and Hewlett-Packard Co (HPQ.N), International Business Machines Corp (IBM.N) and Sun Microsystems Inc (JAVA.O) "neutral". It rated Lexmark International Inc (LXK.N) "underperform".
The PC market has a potential growth rate of 13.6 percent in 2008 and 12.7 percent in 2009, reflecting a better performance than initially feared in a macro economic downturn, Credit Suisse said.
Key drivers of this growth are emerging markets, developed regions including the United States doing well, the business segment becoming more important and aggressive pricing of notebooks making up for desktop weakness, Credit Suisse analyst A. Bommelaer said in a note to investors.
"We see solid growth for the prominent Apple 3G iPhone driven notably by its evolving economics - iPhone now unlocked, greater subsidies leading to lower retail price and no geographic exclusivity," the analyst added.
Infineon (IFXGn.DE) may benefit from the Apple iPhone, the analyst noted, adding that Infineon currently supplies 100 percent of digital baseband, power management, and other components for a combined semiconductor content to Apple, at $20 per phone.
The analyst also said that STMicroelectronics (STM.PA) generates 16 percent of its revenue from PCs and peripherals and would be a clear beneficiary of a stronger PC market. (Reporting by Adheesha Sarkar in Bangalore; Editing by Bernard Orr)
