In a new research note, Stifel analyst Doug Reid argues that RIM has hyped the PlayBook well beyond the earnings-per-share contribution the laggard tablet might potentially make. “Despite minor hardware improvements, the PlayBook with WiFi remains less competitive relative to both iPad 2 and Xoom,” Reid writes, before reciting the same list of perceived flaws that bother other critics. “First, PlayBook’s lack of basic e-mail and calendar functionality (standalone) immediately gates the device’s addressable market to BlackBerry users, a market of only 55 million,” he explains. Second, the PlayBook’s app ecosystem is piddling at best, thanks to a lousy developer experience (which, to be fair, RIM is working to improve). According to Reid’s estimates, PlayBook will have fewer than 100 apps at launch–assuming it doesn’t debut with support for Android apps. Then there’s its screen size. Reid beleives that consumers familiar with the iPad’s 9.7-inch screen will likely view the PlayBook’s smaller 7-inch screen as a deficit.

And finally, the most troubling reason of all: the PlayBook’s ship date. It arrives at market after both the iPad 2–the market-leading tablet’s latest iteration–and the Xoom–which is said to be the first truly comparable competitor to it. Worse, it risks being lost in the flood of tablets launching over the next few months.

Late to market with a first generation tablet and an inferior value proposition. That seems to be RIM’s predicament today. Though who knows. Perhaps there’s some hidden competitive advantage here that’s being overlooked, or one that we haven’t yet seen.

Remarking on Apple’s (AAPL) December quarter in a note to investors this morning, Thomas Weisel Partners analyst Doug Reid said iPhone and iMac sales for the period have been quite strong. “Our checks suggest December quarter sales of iPhones are tracking ahead of our prior estimates, driven by increased market penetration in the United States, additional carrier agreements in multiple countries, and first-time launches in Korea and China,” Reid wrote.

“Mid-December Apple Store and carrier checks indicate that the 2009 holiday shopping season has seen a sharp increase in the purchase of iPhone as a gift option,” the analyst continued. “We also estimate better than expected iMac sales in the quarter following a successful product refresh (announced on October 20). Our checks indicate strong demand throughout the holiday season for the new iMac line.”

Seems that the shipping delays associated with Apple’s new 27-inch iMacs haven’t undermined sales nearly as much as some feared. Reid says that demand and in-store availability of both 21.5-inch and 27-inch models remains strong, so much so that he’s raising his iMac unit estimate for the December quarter from 655 thousand to 721 thousand.

Demand for the iPhone has also been strong thanks to the end of carrier-exclusivity agreements in some markets.

“The ability to add iPhones to existing family service plans with carriers has been a key driver in C4Q09, our checks indicate. In addition, industry checks also suggest that AAPL is benefiting from the addition of second or third carriers in markets (e.g. UK, Canada) and from a strong initial sales ramp in Korea.”

How much of a benefit? A sizable one. Reid figures Apple will sell 8.21 million to 8.89 million iPhones during the December quarter. And he expects the company to sell 31.59 million to 32.27 million in fiscal 2010.

Five dollars and a ratty “Think Different” T-shirt says Apple shares will hit another new 52-week high today.

Though there’s a delay in reimbursement, Cray likely won’t have to take a lower rate on future reimbursement from DARPA, he believes.

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Thomas Weisel Partners visited 41 Apple (AAPL) retail locations in the United States, Canada and the U.K. over the weekend and was impressed by what it saw: “robust sales driven by sustained brand strength, rising demand for app-ready iPod touches and a positive-mix in Macs driven by Black Friday discounting.”

The research house says its checks suggest that same-store sales are up slightly year-over-year, driven by unflagging demand for the iPhone, among other things.

“While competition continues to intensify as new Android devices ramp our early holiday season analysis suggests upside exists to our Dec. quarter iPhone unit estimate of 8.2 million driven by growth in the broader smartphone market and overall market share gains by iPhone,” analyst Doug Reid explained in a note to clients.

“Although we see evidence of a strong early ramp by products which compete against iPhone, notably Droid on Verizon in the United States,” Reid added, “our checks indicate sales of iPhone remain strong in Europe and are accelerating off a low base in Asia.”

And what of Mac sales? With just one month of data, it’s a bit too early to make a call on the quarter–especially when nearly 50 percent of Mac sales in this quarter typically occur in the month of December. That said, Thomas Weisel expects Mac sales to be quite strong on increased demand for notebooks–specifically the MacBook Pro.

“Following checks we estimate that at 21 of the 41 stores (51%) MacBook Pro (led by the lower end 13” model) out-sold the recently introduced $999 MacBook. We had expected the lower ASP MacBook to outsell the Pro by 70% to 30%,” Reid wrote.

“The strength in Pro sales is consistent with Apple’s unexpected move to discount the MacBook Pro line but not the MacBook (resulting in a selling price for the 13″ MacBook Pro of $1098 in the United States, only $99 more than the $999 MacBook). We believe that Apple continues to benefit from the strong consumer PC demand that we saw in the Sep quarter.”

• A delayed EC review process of the current proposed acquisition, which may end in a rejection left unchallenged by Oracle
• A renegotiated deal with Oracle, which would likely exclude MySQL and therefore involve a renegotiated deal price
• An offer by IBM (IBM) to buy Sun at a discount to the Oracle offer following a rejection by the EC of the current Oracle deal
• A scrapping of the deal by Oracle

Interestingly, Reid feels this last possibility isn’t as disastrous as it might sound. Sun has $1.8 billion in cash, and while its latest results weren’t at all pretty, they did feature improving gross margins.

“Our current thesis on [Sun] assumes the announced [Oracle] acquisition will close, but risks have increased,” Reid wrote. “There remains a risk that the European Commission will provide a ‘statement of objections’ to [Oracle’s] planned acquisition of [Sun] based on concerns regarding [Oracle’s] plans for the MySQL database which [Sun] currently owns. The deadline for such a decision is January 19, 2010 but it is possible that the EC will state objections before the end of the year.”

Elaborating, Reid notes that “Although [Oracle] could likely reduce the risk of a statement of objection–and thus of a delayed or perhaps failed bid for [Sun]–by supplying to the EC an argument to explain why the [Oracle-Sun] deal will not adversely impact competition in the database market, our assumptions around [Sun’s] valuation include increased risk regarding the completion of the [Oracle-Sun] transaction at $9.50….While we believe the currently proposed acquisition by [Oracle] is the most likely outcome for [Sun], we believe other scenarios remain possible, although each is made more difficult by the continued uncertainty around Sun’s fate, and the resulting erosion in customer confidence in Sun.”

Since the beginning of the year, Apple shares have more than doubled from $90.75 on Jan. 2 to almost $186 today.

Google (GOOG) has done about half that performance, while Microsoft (MSFT) has done one-third. (See the chart below; click on it to make it larger.)

But that’s apparently not enough, according to Thomas Weisel analyst Doug Reid, who has raised his price target on Apple (AAPL) stock to $210 from $180 a share.

Citing higher sales and profit estimates, healthy demand and the iPhone headed to China–and the launch of a cheaper $800 MacBook soon–Reid wrote, “We believe there is a high likelihood Apple will fortify its entry into the holiday season and that such a move will be a positive for AAPL shares.”

While this all makes sense, one wonders if the froth can reach that level.

In any case, perhaps what is more interesting is the $166.4 billion market cap for Apple, which is well below Microsoft at $232 billion.

But it is well above Hewlett-Packard (HPQ) at $113.4 billion, Google at $158 billion, Dell (DELL) at $30.6 billion and Palm (PALM) at a paltry $2.4 billion.

With that kind of massive valuation and a pile of it in cash, perhaps the better question is what Apple will do with its soaring stock.

Oddly enough, Idina Menzel and Kristin Chenoweth singing the big number, “Defying Gravity,” in the musical, “Wicked,” sound a lot like they are channeling Apple’s corporate mantra these days.

Witness:

Thomas Weisel analyst Doug Reid this morning noted that he is “incrementally more cautious” on the company after a survey of 35 “PC experts” over the Black Friday weekend at Best Buy (BBY) stores. Reid writes that Dell remains “a weak competitor” in the retail channel and that “quality problems may be re-emerging.”

Reid says that Dell’s mind share at U.S. retailers “remains weak.” He says sales people preferred Hewlett-Packard (HPQ) over Dell by 5-to-1, asserting that it offers better overall value. “While HP has been sold at Best Buy for much longer than Dell, quantitatively, the results are still somewhat disappointing considering that Dell has been sold at BBY stores for 11 months,” he writes.

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