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Kaufman Bros ups Apple target to $415 in spite of Steve Jobs' absence

post #1 of 18
Thread Starter 
A medical leave of absence from Apple Chief Executive Steve Jobs has not deterred the firm Kaufman Bros. from its bullish stance on the company's stock, and even went as far as to up its price target to $415 on Tuesday.

Analyst Shaw Wu on Tuesday increased the firm's price target to $415, from $395, for AAPL stock. He acknowledged that shares of AAPL will be volatile after the news that Jobs will take a leave of absence from the company, but also noted that Apple's ongoing platform adoption story remains intact.

"We have the utmost respect and awe for Steve's contributions to technology and society and put him on the same level as the greats including Thomas Edison, Benjamin Franklin, and Walt Disney (just to name a few)," Wu wrote. "But we believe like his predecessors, he has successfully embedded his way of thinking and philosophy into the culture of AAPL.

"For a company of AAPL's tremendous size where consensus is looking for $90.4 billion in revenue in (fiscal year 2011), we believe its nearly 50,000 strong (employees) don't receive enough credit for the company's great success."

Wu expects Apple on Tuesday to announce sales of 16 million iPhones, 6.1 million iPads, 4.2 million Macs, and 17 million iPods. But he also noted that there is room for upside on the company's gross margin, as Apple's guidance of 36 percent will likely prove conservative.

Other analysts chimed in on Tuesday with their take on the impending earnings call, as well as the announcement from Jobs. AppleInsider offers a quick rundown of those opinions below.

Ticonderoga Securities

Analyst Brian White advised investors to "stay the course with Apple" in the face of Jobs' medical leave. Still, he expects the stock to be under "heavy pressure."

"Steve Jobs deeply cares about his employees and the future of Apple," White wrote. "Thus, we believe he has been building a strong team that is able to successfully lead Apple into the future."

Like many, the analyst expects Apple to report a record quarter in its earnings call. He sees the company exceeding his revenue estimate of $24.17 billion, and also sees upside potential with his projection of $5.35 earnings per share.

Gleacher & Company

Analyst Brian Marshall has maintained his buy rating and price target of $355 for AAPL stock. He said that he is "saddened" to hear that Jobs' health remains an issue.

Marshall believes there will be material short-term weakness in the company's stock, but he sees that as a buying opportunity. He has advised investors to "get aggressive" if the price drops to around $300.

"Obviously Jobs is irreplaceable as the industry's innovator, but he has more pressing matters today than being CEO of AAPL, in our view," he wrote. "Running a $100 billion annual revenue company while being forced to take periodic medical leaves is not fair to anyone (e.g., most of all to Jobs, AAPL investors or its employees/board."

But Marshall has faith in Tim Cook's ability to take the reins in the absence of Jobs, as the chief operating officer successfully did in 2009.

Deutsche Bank

The fact that Jobs is retaining his CEO title could signal a shorter absence from Apple this year, analyst Chris Whitmore said. He also sees it as a positive that Jobs will be involved in strategic decisions for the company, but he also has confidence in Apple's deep management team.

"We believe Tim Cook is a proven operator and very capable of managing Apple's day to day operations," Whitmore said. "We also believe AAPL's product roadmap for the next 12 months is largely set and Cook (and team) will ensure crisp execution on that roadmap."

Deutsche Bank expects Apple to beat consensus revenue and EPS estimates, and has predicted revenue of $25.345 billion, with $5.60 EPS. Whitmore sees Apple selling 16 million iPhones, 6.5 million iPads, 4.2 million Macs, and 19.3 million iPods.

Needham & Company

Charlie Wolf still recommends Apple's stock, as he believes shares of the company were relatively inexpensive even before the news that Jobs would take a leave of absence. He noted that Apple has "one of the deepest managerial benches in this country."

"Jobs' absence should have no material impact on Apple's financial performance over the next several years," he said. "The major risk in the Apple Store is Steve Jobs' health. Risks arising from the competitive landscape pale in comparison."

Piper Jaffray

Analyst Gene Munster expects results from the December quarter to be ahead of Wall Street expectations. He believes Apple's earnings will be driven by strong and iPad and iPhone results, with a supply less constrained than in the previous quarter.

"iPhone and iPad remain somewhat of a wildcard, albeit positive, and we believe solid holiday demand could drive upside to Street numbers," Munster wrote to investors.

The analyst expects Apple to give its traditional conservative guidance for the March quarter, with revenue of $22.76 billion and $4.41 EPS. But he also said those numbers could be low given the impending launch of the iPhone on Verizon on Feb. 10.

Apple will report its earnings for the first quarter of its fiscal year 2011 this afternoon, and will also hold a conference call to discuss the results at 5 p.m. AppleInsider will have full, live coverage.
post #2 of 18
What a tumultuous day for Apple.
post #3 of 18
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Originally Posted by nvidia2008 View Post

What a tumultuous day for Apple.

Speaking strictly about the stock, it'll bounce back.

Proud AAPL stock owner.

 

GOA

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Proud AAPL stock owner.

 

GOA

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post #4 of 18
Quote:
Originally Posted by AppleInsider View Post

"We have the utmost respect and awe for Steve's contributions to technology and society and put him on the same level as the greats including Thomas Edison, Benjamin Franklin, and Walt Disney (just to name a few)," Wu wrote. "But we believe like his predecessors, he has successfully embedded his way of thinking and philosophy into the culture of AAPL.

Interesting, this comparison. Thomas Edison was a notoriously poor businessman, and the Disney empire was built as much on the business smarts of Roy Disney as it was on Walt's imagination.
Please don't be insane.
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Please don't be insane.
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post #5 of 18
What's amazing is who the entire punditocracy is missing the story today, which is how LITTLE the stock has dropped (down only 9.33 at 10:00 Pacific).

The first time around, there was genuine uncertainty and fear when Steve took ill.
But since then, Tim Cook has become a known and trusted commodity, and in hindsight people are recognizing that most of the hit AAPL took last time coincided not only with Jobs' leave, but with an entire global meltdown.
I'm almost disappointed that there wasn't a bigger drop today because I had planned a big buy if it got below $310.
The announcement was well timed, not only by giving the market (at least the American market) a chance to chill on MLK day, but also just in advance of what will certainly be a mind-boggling quarterly today.

There certainly is cause for concern, but its not along the lines everyone is mindlessly repeating. Great article by Brian S Hall discusses it.
http://brianshall.com/content/steve-...says-yes-or-no

Another salient point is that there is no way Jobs has ignored the implication of his fragile health on Apple, particularly in light of the crash the company took after his initial ouster.
Steve's biggest product over the past 10 years has not been iPod, iPhone, iMac or iPad, but 'iApple'.
The groundbreaking products are out there, and what's ahead is maintaining the massive lead Apple already has.
I personally think the biggest loss could be Steve's legendary negotiating skills as the big hurdle ahead is with content licensing.
post #6 of 18
Quote:
Originally Posted by Dr Millmoss View Post

Interesting, this comparison. Thomas Edison was a notoriously poor businessman, and the Disney empire was built as much on the business smarts of Roy Disney as it was on Walt's imagination.

Pardon...and what was the company Ben Franklin founded? I forgot that part.
post #7 of 18
Quote:
Originally Posted by GQB View Post

What's amazing is who the entire punditocracy is missing the story today, which is how LITTLE the stock has dropped (down only 9.33 at 10:00 Pacific).

What clock are you on? Pacific is only 9:08 right now! And it's now dropped by 11- stick around some today.
post #8 of 18
If it drops $15 dollars or more I'll probably buy another ten or twenty shares ... I seriously doubt the stock is going to tank in the long run (particularly the next two fiscal quarters).
post #9 of 18
Quote:
Originally Posted by iLiver View Post

What clock are you on? Pacific is only 9:08 right now! And it's now dropped by 11- stick around some today.

You're right. Need to wash my glasses.
But my point stands. 9:33 and now only down $8.88
post #10 of 18
Quote:
Originally Posted by iLiver View Post

Pardon...and what was the company Ben Franklin founded? I forgot that part.

Made it big in the publishing industry.
post #11 of 18
Quote:
Originally Posted by iLiver View Post

What clock are you on? Pacific is only 9:08 right now! And it's now dropped by 11- stick around some today.

CURRENTLY DOWN ONLY 7.44

What a comeback!
post #12 of 18
Quote:
Originally Posted by GQB View Post

Steve's biggest product over the past 10 years has not been iPod, iPhone, iMac or iPad, but 'iApple'.
The groundbreaking products are out there, and what's ahead is maintaining the massive lead Apple already has.
I personally think the biggest loss could be Steve's legendary negotiating skills as the big hurdle ahead is with content licensing.

I think you nailed it with this single, last sentence. It really isn't about the products; Apple uses parts that are available to the competition as well. It's more about how Apple integrates there parts: the hardware, software and partnerships. His negotiation skills are legendary indeed. I remember Steve from a Q&A with Walt(?) that he wanted the music industry to put their music on the iTunes store. They were failing at the way they were going about it, and all he said was: "See, I told you so. Come on board with Apple" (or similar words...)

May Steve be with us for a long time to come.
PhilBoogie
Send from my iPhone. Excuse brevity and auto-corrupt.
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Send from my iPhone. Excuse brevity and auto-corrupt.
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post #13 of 18
"and put him on the same level as the greats including Thomas Edison, Benjamin Franklin, and Walt Disney (just to name a few)"

Just, wow.
post #14 of 18
At the moment APPL is less than 2% down, climbing steadily since opening. Unless there's a big sell off before the close in anticipation of the quarterly report, it doesn't look like the unfortunate news is going to have much of an impact on the stock price (although of course the real human impact lies elsewhere).

I hesitate to say that this means investors have confidence in the Apple bench, since there often seems to be no rhyme nor reason to what "investors" (read computer programs) do, but there does seem to be less uncertainty around Apple's future than the last time Jobs took a medical leave.

Could it be the Apple juggernaut has finally outgrown the sense of coming down to one man?
They spoke of the sayings and doings of their commander, the grand duke, and told stories of his kindness and irascibility.
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They spoke of the sayings and doings of their commander, the grand duke, and told stories of his kindness and irascibility.
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post #15 of 18
Quote:
Originally Posted by PhilBoogie View Post

I remember Steve from a Q&A with Walt(?) that he wanted the music industry to put their music on the iTunes store. They were failing at the way they were going about it, and all he said was: "See, I told you so. Come on board with Apple" (or similar words...)

+1.

Maybe SJ can be just the negotiater for Apple, say yes/no to strategic decisions. and let Tim Cook run the company.

I bet that's their plans; that's why SJ has retained the CEO title. I think he won't be back to the campus, except for maybe once in a blue moon.
post #16 of 18
Quote:
Originally Posted by iLiver View Post

Pardon...and what was the company Ben Franklin founded? I forgot that part.

He was a successful author and publisher, among other things. So what was the point of your question?
Please don't be insane.
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Please don't be insane.
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post #17 of 18
Quote:
Originally Posted by addabox View Post

At the moment APPL is less than 2% down, climbing steadily since opening. Unless there's a big sell off before the close in anticipation of the quarterly report, it doesn't look like the unfortunate news is going to have much of an impact on the stock price (although of course the real human impact lies elsewhere).

I hesitate to say that this means investors have confidence in the Apple bench, since there often seems to be no rhyme nor reason to what "investors" (read computer programs) do, but there does seem to be less uncertainty around Apple's future than the last time Jobs took a medical leave.

Could it be the Apple juggernaut has finally outgrown the sense of coming down to one man?

Maybe, or perhaps investors are waiting to see if another shoe drops.
Please don't be insane.
Reply
Please don't be insane.
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post #18 of 18
Quote:
Originally Posted by Dr Millmoss View Post

Maybe, or perhaps investors are waiting to see if another shoe drops.

Like Apple uses the occasion of unprecedented and estimate exploding profits to announce Jobs isn't coming back? I think that would induce a seizure.
They spoke of the sayings and doings of their commander, the grand duke, and told stories of his kindness and irascibility.
Reply
They spoke of the sayings and doings of their commander, the grand duke, and told stories of his kindness and irascibility.
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