Friday, September 12, 2008, 02:00 pm
Analyst trims Apple estimates, says Air seeing decreased demandAmerican Technology Research trimmed its estimates for Mac maker Apple Inc. on Friday, saying that while the company's near term prospects look fine, future quarters may be met by muted demand, particularly for higher-end products like the MacBook Air.
"While we continue to see fairly favorable unit trends in the September quarter with back-to-school, our supply chain checks indicate low visibility in the December and March quarters, which we believe will likely impact build plans," analyst Shaw Wu advised clients in research report.
Based on those findings, Wu said he's decided to once again "err on the conservative side," as he believes tough macroeconomic conditions will lead system builders and distributors to keep their inventory levels low.
"In addition, our supply chain checks indicate a mix shift towards low-end and mid-range Macs as it appears that more affluent consumers may be feeling the effects of a tighter credit environment," he wrote. "MacBook Air sales and build plans appear more modest after more robust levels."
For fiscal 2008, the analyst now estimates Apple to earn $5.29 per share on sales of $32.8 billion, compared to his previous estimate of $5.34 on $32.9 billion. His model for fiscal 2009 now has the company earning $6.15 per share on revenue of $38.8 billion, down from $6.35 on $39.2 billion.
Those estimates factor in changes to his model for the next two quarters: For the current September quarter, Wu expects per share earnings of $1.19 on sales of $8.2 billion, down from $1.24 on $8.3 billion. Revisions to his model for the December holiday quarter have the company earning $1.90 per share on sales of $11.4 billion, down from $1.96 on $11.5 billion.
"We are leaving our Mac assumptions intact at 2.8 million for the September quarter, but lowering our average selling price [estimate] (4 percent quarterly decline vs. our previous view of 2 percent decline) and gross margin assumptions (32.5 percent vs. previous view of 33 percent)," he wrote.
That said, Wu still recommends that investors buy shares of the Cupertino-based electronics maker. He's, however, reduced his 12-month cieling on the company's share price to $205 from $220, which represents 31.5 multiple of his calendar year 2009 earnings estimate of $6.52 per share.
Shares of Apple were trading down $4.25, or 2.78 percent, to 148.40 in afternoon trading on the Nasdaq stock market.
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