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Microsoft (NASDAQ:MSFT) competes with Apple (NASDAQ:AAPL) and SanDisk (NASDAQ:SNDK) in the portable media player market. We currently have a Trefis price estimate of around $28 for Microsoft’s stock, about 11% above the current market price of around $25.

Trefis members have created forecasts for two key drivers of Microsoft’s stock over the last week: (1) Zune Average Selling Price and (2) Global Portable Media Player Market. The members’ forecasts suggest that Zune Average Selling Price will trend slightly below the Trefis estimate, while Global Portable Media Player Market will trend slightly above.

We estimate that Xbox & Zune constitute around 1% of the $28 Trefis price estimate for Microsoft’s stock. Below are charts showing recent estimates created by Trefis members for the two drivers: (1) Zune Average Selling Price and (2) Global Portable Media Player Market.

1. Zune Average Selling Price

The average of forecasts for Zune Average Selling Price created by Trefis members indicated a projected decrease from around $219 in 2010 to around $155 by the end of the Trefis forecast period, compared to the baseline Trefis estimate of a decrease from around $226 in 2010 to $166 by the end of the Trefis forecast period. The member estimates imply a small downside to the Trefis price estimate for Microsoft’s stock. In the past, Zune Average Selling Price has decreased from $250 in 2007 to $238 in 2009.

Disagree? You can drag the forecast trend-line above to express your own view, and see the sensitivity of Microsoft’s stock to Zune Average Selling Price.

2. Global Portable Media Player Market

The average of forecasts for Global Portable Media Player Market created by Trefis members indicated a projected decrease from 166 million in 2010 to around 135 million units by the end of the Trefis forecast period, compared to the baseline Trefis estimate of a decrease from 162 million in 2010 to around 108 million units by the end of the Trefis forecast period. The member estimates imply a small upside to the Trefis price estimate for Microsoft’s stock. In the past, Global Portable Media Player Market has increased from 120 million in 2005 to 180 million units in 2009.

Disagree? You can drag the forecast trend-line above to express your own view, and see the sensitivity of Microsoft’s stock to Global Portable Media Player Market.

Disclosure: No positions

Source: Zune Media Player Doesn't Move Needle on Microsoft Stock