Not going to happen. It's annoying, fun and fashionable to disrespect Apple products. Win-win-win. Especially if you work for a competitor or you prefer a competitor's ecosystem. Even if you might admire the watch, the fact that it's necessarily linked to an iPhone for functionality means you'd have to think about getting an iPhone to get in on the Apple watch gig. I can understand where my nephew, say, might find that extremely difficult. He's pretty analytical about matters having to do with gear, but if he saw Apple watch jump way out in a gen 2, he'd still have a hard time going there and it wouldn't be about the watch. It would be about having to ditch his other smartphone and its apps. He'd do it if he saw the advantage to his life in making that move. Still, there's part of him that just likes to josh me about having Apple gear and he'd be very very distressed to give that up!!

So there's a face saving thing that has to be overcome for some people to switch. Apple can see that. They ran their Apple vs. PC ads to help people get past it. Stay tuned...
They're not necessarily clueless. Wearables are still a dicey bit of computing markets, although I expect that to change as chips shrink and the world at large becomes more automated.
But maybe some analysts also just envy traders being in the spotlight (some for the wrong reasons, admittedly) compared to relative oblivion of being analysts, so some may pitch "flop" to stand out in the crowd. And remember the old saw about how even a broken watch is right twice a day (in 12 hour context), well there's some of that running around in financial analysis circles.
It's what makes markets anyway; someone has to believe a price is right for selling while someone else believes it's right for buying. The analyst who leans on Apple today maybe will like to see that price drop to where his firm's clients (or his firm's trading desk) jumps all over it. There's a difference between dissing a stock and actually short-selling it. I'm the the group that thinks talk is cheap. So is anyone who bought Apple for ten, twelve bucks back in the 90s and hung onto it. They've probably long since cashed out the cost of whatever they bought and everything they hold onto now is just gravy. Nice cushion for Apple when these brief post-earnings plunges take place.
No one has ever been able to guarantee anything except that change is inevitable. "Evolve or die" seem to be the options. Evolving fast enough and managing to survive, those are the challenges.
The planet Venus was resurfaced one afternoon while someone was maybe picking out new carpet. Venus said "How about beige" and that was that. All the comfy old craters she'd acquired throughout her history were gone! No need for carpet. No need for historians to write anything down, either. No historians! All that humans know about it for sure, so far, is that the planet's surface is a lot younger than the planet.
So no one was waiting for a smartphone like the one that Apple suddenly produced. Same with tablets. Jobs even dissed tablets at one point, probably while they were tweaking their design for the iPad on the Apple drawing boards... can't fault him for trying to slow down the competition ahead of time. Now some of us are anticipating an iPad Pro, or paying down their credit cards for a refurb iPad Air 2 (me), or they just can't resist getting the new iPod touch (also me) while the wait for the next surprise in tablets goes on.
Apple has long since realized each product line has its own upgrade cycle tendencies. The iPhone is their flagship, iPad runs sort of tangentially to that but probably only because portability is a little more limited for guys not wearing cargo pants, and also because tablet computing is still (temporarily, imo) throttled compared to OS on desktops. The notebooks get updated more often than desktops. I would expect smartphones to continue being updated more often than tablets for the next five or six years. As time goes on, Apple gets better at syncing its releases with people's willingness to upgrade particular products. Their development costs sink as iterations continue so they can afford to put up a new color of shuffles now and then, or tweak some newer goodness into an iPod touch. Same with iPads. I wouldn't worry about tablets disappearing, they are huge in the corporate market and that will only continue: once they bite, they're hooked.
I agree with others here who think the iPad cycle is more akin to that of notebooks and that the watch might eventually fall into that category as well. Which imo is another argument for a high margin; I don't expect quality goods for the price of lower quality merchandise but that irrational expectation does exist in the marketplace and a company has to play the role of the grownup in the room sometimes.
Even when I was 20, I knew not to buy cheap goods if I needed them to last a long time. Today a lot of people seem to think everything should be cheap, but they will treat everything as if designed to be driven over by their SUV. People like that may not be able to distinguish good from poor quality. I am not surprised they complain about price of Apple gear vs stuff of less expensive manufacture.
I've been buying Apple gear since Macintosh 512k, but I don't buy one every year. Every two or three years is my speed on notebooks, but I love it that when I do upgrade, my previous one is in fine condition and can be handed on in working shape for someone else to drive into the ground (which can take a decade sometimes, since not everyone needs enough computing power to run a city from a laptop).
With Apple, it's been great to see that software has generously supported a few cycles back in hardware. When you finally can't update your software, you know it's time to spring for newer gear. Seems fair enough, and it has worked out great for me. I'd expect that to hold true for the watch but as we get closer to being able to see those very very small chips in commercial use, that cycle may close up some because everyone would love to see a thinner watch.
Having 75% of the market is impressive. Will it continue? Yes. The apps, battery tech advancement and tinier chips will drive the thing. The younger generations are more health-conscious than us old geezers. The apps we can't even envision yet are being brainstormed as I write this post. The iPhone knocked the socks off the smartphone market. That was before there were many apps past games to demo, and most of us thought having a music player and a phone that "just worked" was pretty cool. Fast forward a few generations of hardware and software and creative app rollouts. Can't remember when a phone was just a phone? Nor can I. Et voila, give the watch a couple gens and then let's do the thread again.
Yeah, it's almost human...
See below.
Exactly.
Because, Apple.
Hammer on the stock when earnings are released or a new product is rumored, launched, seen in the wild... if enough people join in the fun, perhaps they can drive the stock down far enough to then be able to buy in on the cheap, ride the upcurve and sell when the rumors of the NEXT "one more thing" are leaked. It may seem counterintuitive as hell but it's fun to, uh.. watch. It has been going on with Apple now for decades. Every time they come to market with something, or don't come to market with something, the death knell sounds anew. It's just a bunch of people trying to get in on the ground floor by lowering the ceiling and jumping off the roof. To each his own. The rest opt for "buy and hold" which has its own pitfalls and potholes, but if you're young, I'd hang onto Apple long enough to recover the cost, party on some and then hang onto the rest as a gravy train. Full disclosure: I own a very few shares. And, I am pretty old.
Well actually a high margin can mean a couple other things. It can mean anticipation of not sellling enough of an original iteration of a product to offset the entire cost of having developed the thing. Not that uncommon in tech gear. Early adopters of Apple gear still mostly show up for the new thing but we're living in dicey economic times and a lot of the money for tech gear comes from young professionals or from baby boomer parents with kids in school or kids just out of school with no jobs. That whole category is either debt-strapped or wary of taking on more debt. Apple can't be ignoring that in its calculations. The economy is recovering and Apple's likely to go with a gen 2 of the watch but in the meantime they'd be nuts not to have a high margin on the original watch.
Another and more common reason for having a high margin on a particular item: It's offsetting losses in an ancillary service or in another product line, e.g., when your supermarket sells you peppers at 88c / lb it's taking a real beating, but it got you in the door and it hopes you will also buy a plastic dishwashing brush for an incredibly overpriced $5, which will not only cover its loss on cost of the peppers but also make a profit on the brush AND let it sock away some dough for a rainy day.
Bottom line, a company is in business to make a buck and it will try to do that by getting you into the store and showing you some merchandise for you to buy if you want to do that. Today you have to show a customer some deals, so probably whatever's not a deal is going to be carrying some freight in its price. So, caveat emptor. So okay, I'll let you figure out what are the equivalent of Apple's plastic brushes, but they could be any product lines that sell well to an expected niche but are not currently likely to break out of that niche. Maybe the desktops. Maybe the high end laptops.
Let's talk about that "rainy day" money in the profit margin for a minute. One kind of rainy day is when you put a low margin or loss-making price on something and no one comes to your sale. Usually that's when people have figured out that you charge too much for everything not explicitly marked with a SALE! price. Apple's not there yet, because as others here have pointed out, their gear is built to last and holds up very well. But, they could be getting there on price sensitivity. It depends on whether people stay interested in paying more for quality and whether they think they are getting what they paid for. Scaling up to volume of demand while maintaining quality is sometimes very difficult, as Apple has already discovered in at least some past iterations of the iPhone and notebooks. Time will tell

with successive iterations of the Apple watch, assuming they got their price points right and so end up selling enough of gen 1 to go around again. They've done this exact kind of guesstimate over and over before, and successfully, so I wouldn't bet against them.