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Monday, April 23, 2012, 08:34 am PT (11:34 am ET)

Strong Apple earnings expected to offset recent 'profit taking'

A recent downturn in Apple's stock has been dismissed as simply "profit taking" ahead of this week's earnings report, in which Apple is expected to exceed Wall Street expectations.

Apple will report its earnings for the March quarter on Tuesday after the markets close. The results will be disclosed following a tumultuous few weeks for the stock, which saw it drop 11 percent, led by the company's single largest one-day point drop plunge of $25.10.

Analyst Brian White with Topeka Capital Markets isn't concerned about the recent volatility with AAPL stock. He sees the 11 percent drop in recent weeks as "profit taking," rather than any legitimate concerns over Apple's business.

White has forecast sales of 29.6 million iPhones in the March quarter, along with 11.58 million iPads. He believes both of those have upside potential, as the iPhone has continued to expand and the new iPad sold a record 3 million units over its launch weekend.

Chris Whitmore with Deutsche Bank also has high hopes ahead of Tuesday's earnings report, as he expects Apple to beat consensus revenue and earnings per share estimates of $35.9 billion and $9.78, respectively. He has modeled for Apple to report sales of 26 million iPhones, 10 million iPads and 4.5 million Macs, though he noted that the iPhone number is "conservative."

Whitmore expects that demand for the iPhone 4S will be moderate this summer, as consumers begin to anticipate and wait for Apple's next-generation iPhone, expected to arrive this fall.

iPhone 4S


In addition to a new iPhone, both Whitmore and White also believe that Apple could launch its long-rumored television set later this year. White also cited the rumored "iPad mini" as a device he expects will see the light of day later this year.

Both analysts also expect that Apple will issue its traditional conservative outlook for the next quarter, as the June quarter is expected to be particularly uncertain with with the performance of the iPhone 4S ahead of this fall's expected iPhone revamp.

That take, shared by both White and Whitmore, is different from Sterne Agee's Shaw Wu, who said last week that he believes Apple's guidance for the June quarter may be less conservative than usual. He cited particularly strong sales of both the iPhone and iPad as reason that Apple may want to be more aggressive in its guidance.