Katie MarsalDespite a number of concerns on the part of investors, analysts for American Technology Research say Apple Inc. is again poised to post bold numbers for its forth fiscal quarter ending later this month.
"As a result, we are raising our forecast to $5.96 billion in revenue and $0.83 in earnings-per-share (from $5.8 billion and $0.73) versus guidance of $5.7 billion and $0.65 and consensus of $5.94 billion and $0.81," he wrote. "We are modeling a gross margin of 32.5 percent (from 30.8 percent) versus guidance of 29.5 percent."
While Wu had anticipated strength from the new "fat boy" nanos during the quarter, he said he was surprised to learn that the higher-priced iPod classics and iPod touches are also selling quite well. Similarly, he said, overall demand for Apple's Mac line is stronger than anticipated with an unexpected mix shift towards high-priced models.
Given his checks, the analyst raised his iPod units sales estimate for the quarter ending September 29th to 11 million units from 10.4 million units, and his Mac unit forecast to 2 million units from 1.95 million units.
"Contrary to fears with potential cannibalization from new iPods and backlash from an iPhone price cut, iPhone sales have regained momentum," he added. "For the September quarter, we are now forecasting 900,000 units (from 770,000 and guidance of 730,000)."
Wu also tweaked his fiscal 2008 forecast, which he notes is now ahead of consensus estimates. The analyst is now modeling Apple to generate $30 billion in sales and per-share earnings of $4.55 (from $29.5 billion and $4.25) versus consensus of $29.5 billion and $4.41.
"While we are concerned with potential softness in US consumer spending, it appears that Apple is once again positioned to buck the trend with its compelling product line and strong international exposure (52 percent of revenue)," he wrote. "We recommend buying Apple on pull-backs and see upside to [our $185 target] in 6-12 months."
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21 Comments
A definite megatrend!
They have already sold more than 1 million iPhones which means the number of iPhones sold will be significantly higher than 900'000. My estimate is 1.5 million. The iPod and Mac sales estimates are in line with my own expectations.
They have already sold more than 1 million iPhones which means the number of iPhones sold will be significantly higher than 900'000. My estimate is 1.5 million. The iPod and Mac sales estimates are in line with my own expectations.
The 1MM units is including last quarter... I think you are a bit overly optimistic with 1.5MM for the quarter. 900k Units would be just fine by me, although I can dream that they will hit 1MM.
The only way they could possibly hit 1.5MM for the quarter is if they start selling iPhones in the UK, Germany, France, and Spain tomorrow, and even that would be a big stretch.
Mmm... That Wu-tastic analysisis has restored my sense of childlike wonder, and just in time for Halloween and Christmas!! w000t
Exactly what are the concerns that bother long-term Apple investors. The thing that bothers me the most are short-term Apple investors. And maybe bloggers, too. Every little thing about every Apple product is gone over with a fine tooth comb. Crooked nano screens, slow Coverflow, Touch screen black range, poor iTunes synching. The list goes on and on. Most companies put out a product and three-quarter decent is good enough, but Apple products NEED to be perfect. Short term investors don't like hearing about those sort of problems. It scares them silly.
I don't see any serious problems with Apple's products to cause worry. A decent line of iPods. A brisk-selling iPhone in the U.S. and soon Europe. IMacs are selling well. Plenty of Apple stores opening and doing brisk sales. Leopard's imminent release. Apple is cash heavy. Apple TV isn't doing that well right now, but maybe the iTunes movie rental will boost sales.
Still no large names are really pushing Apple stock, so it appears to be stuck at $130-140 range for a little longer. Mild target price boosts don't do anything much for Apple stock. Only ultra-brisk iPhone sales in Europe and tens of millions of iPods being sold during the holidays will move the stock price up to the $150-155 range.
What's funny is that if RIM announced that a BlackBerry model with a different color was being introduced, look for it's stock to jump a couple of dollars. Now that's weird. RIM has confident investors, Apple doesn't.
My expectations mean nothing. Even if Apple products outsell mostly everything they compete against, it has to be by a huge margin. Otherwise it just isn't good enough to please analysts or investors. Even a slight letdown is considered a flop. With target prices spread from $160 to $210 there's such a huge gap of expectations I don't know what to expect.