Shutterfly Reports

Investment

 Analysis:

 Shutterfly

 Inc.

FIN

 580

Yong

 suk

 Lee

Shutterfly Inc.

Overview of an Event Event: Launch of an Apple iPad2 on 11th March 2011 On March 11th, Apple Inc. plans to launch I pad 2 that equips two cameras (front and back) with a faster processor. I pad 2 allows people to take more photos and to modify and upload them more easily for following reasons. First of all, unlike I pad1, I pad 2 has two cameras, allowing users to take pictures. What is more, unlike I phone, I pad series has a bigger touch screen and a faster processor, enabling users adjust pictures easily. Increased usage of digital cameras combined with of high-speed Internet access provides significant growth potential for photography industry. Even though customers shift from analog to digital photography, they upload and share photos on the web such as Facebook with friends and family. Product innovation, focus on developing a successful commercial printing business, strategic partnerships with social networking sites and opportunistic acquisition will provide ample opportunity for growth. Overview of company Shutterfly Inc. (NASDAQ: SFLY) provides a web based photo customization service (Shutterfly.com) that enables customers share, print, and preserve the memory in physical form. The company provides a wide range of photo-based products such as photo books, mugs, calendars, and mouse pads. Due to cyclical industry characteristics, the company earns most of its revenue during holiday seasons (4Q). However, I pad 2 benefits Shutterfly Inc., which focuses on personalized photo market than it does traditional photo printing companies. This will yield more favorable quarterly earnings for regular business quarters (1Q, 2Q, and 3Q). Investment Recommendation: Buy

1) Better positioning in social networking site and application for smart phone or tablet areas: When I enter keywords “photo books” on Google, top...