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31M iPhone sales projected after Apple's strong showing at AT&T

post #1 of 20
Thread Starter 
One Wall Street analyst has reiterated his expectation that Apple sold 30.9 million iPhones in the June quarter, a forecast bolstered by strong iPhone activation numbers from AT&T.

Brian White of Topeka Capital Markets reacted on Tuesday to AT&T's quarterly results, in which the company revealed it sold 3.7 million iPhones in its most recent quarter, 22 percent of them to new customers. With 5.1 million total smartphones sold, the iPhone accounted for nearly 75 percent of all smartphone activations at AT&T.

White sees Tuesday's results from AT&T as even further evidence that iPhone sales for the June quarter will be stronger than many on Wall Street expect. He has called for Apple to report sales of 30.9 million iPhones in the three-month span.

"We believe that the Street has overreacted to iPhone shipment concerns in the June quarter," White said in a note to investors. "We are modeling iPhone shipments of 30.9 million units, or down 12 (percent quarter over quarter), well above Street expectations."

Gene Munster of Piper Jaffray also said Tuesday that he believes AT&T's figures show better-than-expected iPhone sales for the June quarter. His forecast of between 28 and 29 million units is lower than White's, but Munster said he remains "comfortable" with his prediction, which is still higher than most investors.

As AppleInsider highlighted in its earnings preview on Monday, most investors believe Apple will report sales of between 25 million and 27 million iPhones for its third quarter of fiscal 2012.

AT&T vs. Verizon


AT&T's iPhone activations were down just 14 percent quarter over quarter, from 4.3 million in the previous three-month span. In White's eyes, the number is positive, given that it is better than the 16 percent quarter over quarter decline that Verizon reported last week, and that the iPhone 4S first debuted in the U.S. last October.

White also noted that the three leading U.S. carriers — AT&T, Verizon and Sprint — made up just 26 percent of Apple's total iPhone shipments in the March quarter. That's much lower than the 35-to-40-percent level of total iPhone sales that U.S.-based carriers accounted for in 2009 and 2010.

With high expectations for the iPhone, Topeka Capital Markets has maintained its price target of $1,111 for AAPL stock. White said his firm remains "aggressive buyers of Apple at current levels."

Munster noted that if global iPhone sales are in-line with the U.S. sequential decline of 15 percent, it would suggest Apple sold 27 million units in the June quarter. But as international sales of the iPhone increase, the global decline is not expected to be as great as in the U.S.

Apple will report earnings for its third quarter of fiscal 2012 this afternoon after markets close at 4 p.m. Eastern. AppleInsider will have full coverage of the results, as well as the quarterly earnings conference call with Apple executive scheduled for 5 p.m. Eastern.
post #2 of 20
Well so much for the iPad did well but not iPhone expert opinions last week ... well so far anyway. These folks should take up betting at horse racing tracks for entertainment.
Been using Apple since Apple ][ - Long on AAPL so biased
nMac Pro 6 Core, MacBookPro i7, MacBookPro i5, iPhones 5 and 5s, iPad Air, 2013 Mac mini, SE30, IIFx, Towers; G4 & G3.
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Been using Apple since Apple ][ - Long on AAPL so biased
nMac Pro 6 Core, MacBookPro i7, MacBookPro i5, iPhones 5 and 5s, iPad Air, 2013 Mac mini, SE30, IIFx, Towers; G4 & G3.
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post #3 of 20

While ATT is a bellweather for iPhone adoption in the US... The real issues are Europe and China/Asia.  Munster must not have eyeballs in markets over there, as he's hedging his pronouncement.  

My prediction.  Apple shares will rise dramatically today, Fall on the news, and rise again tomorrow.  And I really don't care, as I'm holding my shares through the end of 2013, at least.

post #4 of 20
The entire reason for the Topeka Capital valuation looks to be because it tops it over the $1 trillion company level.

"The real haunted empire?  It's the New York Times." ~SockRolid

"There is no rule that says the best phones must have the largest screen." ~RoundaboutNow

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"The real haunted empire?  It's the New York Times." ~SockRolid

"There is no rule that says the best phones must have the largest screen." ~RoundaboutNow

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post #5 of 20
Quote:
Originally Posted by SolipsismX View Post

The entire reason for the Topeka Capital valuation looks to be because it tops it over the $1 trillion company level.

Wow!

OK back now from stiff drink ... required on the vague chance topping a trillion happens in the next year or so ....
Edited by digitalclips - 7/24/12 at 9:00am
Been using Apple since Apple ][ - Long on AAPL so biased
nMac Pro 6 Core, MacBookPro i7, MacBookPro i5, iPhones 5 and 5s, iPad Air, 2013 Mac mini, SE30, IIFx, Towers; G4 & G3.
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Been using Apple since Apple ][ - Long on AAPL so biased
nMac Pro 6 Core, MacBookPro i7, MacBookPro i5, iPhones 5 and 5s, iPad Air, 2013 Mac mini, SE30, IIFx, Towers; G4 & G3.
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post #6 of 20
Quote:
Originally Posted by TheOtherGeoff View Post

While ATT is a bellweather for iPhone adoption in the US... The real issues are Europe and China/Asia.  Munster must not have eyeballs in markets over there, as he's hedging his pronouncement.  

My prediction.  Apple shares will rise dramatically today, Fall on the news, and rise again tomorrow.  And I really don't care, as I'm holding my shares through the end of 2013, at least.

Every other company on the planet has been reporting slowing sales in Europe and Asia due to crashing economies. If iPhone sales are light I wouldn't be surprised if that were the reason. Especially since in Europe and Asia iPhones are very much LUXURY devices and not everyday smartphones like here in the US.

post #7 of 20

The whisper EPS is now at 11.9  My source had the exact EPS number last quarter so I give it a very reliable rating because I suspect its a leak.  Considering the strong ipad sales, that means the iphone sales are going to be horrible (which means in line with street consensus).  My estimates will be for around 30 millions iphones and 20 millions ipads, which should support an EPS of around 11.9  

 

Those are very good numbers, but for wallstreet anything less than a blowout will send the stock down. I will hold my 2014 options but sell a few october options prior to earning just in case. In fact I will do it right now.

 

Here are the earings numbers prediction made by user White_Knight_in_Texas on the finance forums:

APPLE "BEATS" their own Company Guidance consistently as follows:

2010 Q1 Guidance = $4.80; Actual = $6.43;(Beat=40.0%)
2011 Q2 Guidance = $4.90; Actual = $6.40; (Beat=30.6%)
2011 Q3 Guidance = $5.07; Actual = $7.79; (Beat=53.6%)
2011 Q4 Guidance = $5.50; Actual = $7.05 (Beat=28.2%)
2012 Q1 Guidance = $9.30; Actual = $13.87 (Beat=49.1%)
2012 Q2 Guidance = $8.50; Actual = $12.30 (Beat=44.7%)

Given: APPLE’s EPS Company Guidance is $8.68 for This Quarter ( Fiscal Q3 Ending June 30, 2012) – to be reported July 24, 2012.

If APPLE “beats” their Guidance by only 30% (Equating to an actual EPS of $11.28), then TTM EPS = $44.55…

15 PE = $668.25/sh.;
16 PE = $712.80/sh.;
17 PE = $757.35/sh.;
18 PE = $801.90/sh.;
19 PE = $846.45/sh.;
20 PE = $891.00/sh.


Edited by herbapou - 7/24/12 at 9:54am
post #8 of 20
Quote:
Originally Posted by herbapou View Post

The whisper EPS is now at 11.9  My source had the exact EPS number last quarter so I give it a very reliable rating because I suspect its a leak.  Considering the strong ipad sales, that means the iphone sales are going to be horrible (which means in line with street consensus).  My estimates will be for around 30 millions iphones and 20 millions ipads, which should support an EPS of around 11.9  

I would be a bit disappointed at 11.9, but not worried. You do need to realize that iPads have much less margin than iPhones, until the majority of people realize that 64GB is the right size to get.

At 30 iPhones, 20 iPads, 4.5 Macs, and 44.8% gross margin you are at about $12.13. I am hoping margins are a little better to get closer to 12.3, but we will know in a few hours.
post #9 of 20
I wish the media would stop with these stupid AT&T and Verizon subsidies stories. Every high-end smart phone is subsidized. Go to T-Mobile's website and practically every Android smartphone is free with contract....and a $350 subsidy. But yet listening to the clowns on CNBC you'd think only Apple is benefiting from subsidies. Give me a break...
post #10 of 20

Everyone is missing the growth in China...... YoY growing at 118%!!!  Earnings will rock!!!!  :)

post #11 of 20
Quote:
Originally Posted by herbapou View Post

The whisper EPS is now at 11.9  My source had the exact EPS number last quarter so I give it a very reliable rating because I suspect its a leak.  Considering the strong ipad sales, that means the iphone sales are going to be horrible (which means in line with street consensus).  My estimates will be for around 30 millions iphones and 20 millions ipads, which should support an EPS of around 11.9  

 

Those are very good numbers, but for wallstreet anything less than a blowout will send the stock down. I will hold my 2014 options but sell a few october options prior to earning just in case. In fact I will do it right now.

 

Here are the earings numbers prediction made by user White_Knight_in_Texas on the finance forums:

APPLE "BEATS" their own Company Guidance consistently as follows:

2010 Q1 Guidance = $4.80; Actual = $6.43;(Beat=40.0%)
2011 Q2 Guidance = $4.90; Actual = $6.40; (Beat=30.6%)
2011 Q3 Guidance = $5.07; Actual = $7.79; (Beat=53.6%)
2011 Q4 Guidance = $5.50; Actual = $7.05 (Beat=28.2%)
2012 Q1 Guidance = $9.30; Actual = $13.87 (Beat=49.1%)
2012 Q2 Guidance = $8.50; Actual = $12.30 (Beat=44.7%)

Given: APPLE’s EPS Company Guidance is $8.68 for This Quarter ( Fiscal Q3 Ending June 30, 2012) – to be reported July 24, 2012.

If APPLE “beats” their Guidance by only 30% (Equating to an actual EPS of $11.28), then TTM EPS = $44.55…

15 PE = $668.25/sh.;
16 PE = $712.80/sh.;
17 PE = $757.35/sh.;
18 PE = $801.90/sh.;
19 PE = $846.45/sh.;
20 PE = $891.00/sh.

 

http://tech.fortune.cnn.com/2012/07/24/all-eyes-on-apples-earnings-estimates-are-sharply-divided/

 

Sure, there could be a slowdown because of iPhone 5 anticipation, but who knows. The range is all over the map.

Proud AAPL stock owner.

 

GOA

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Proud AAPL stock owner.

 

GOA

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post #12 of 20
Quote:
Originally Posted by Rogifan View Post

I wish the media would stop with these stupid AT&T and Verizon subsidies stories. Every high-end smart phone is subsidized. Go to T-Mobile's website and practically every Android smartphone is free with contract....and a $350 subsidy. But yet listening to the clowns on CNBC you'd think only Apple is benefiting from subsidies. Give me a break...

The meaningful portion of the commentary right now is that since there wasn't a major iPhone upgrade push this Q, they didn't have the subsidy expense, making profit easier to come by. If the new iPhone is released in October, the picture will be even better for them as people like me with a 4 purchased at launch are out of contract. It is basically something to buffer optimism about T's results.
post #13 of 20

Even if iPhone sales disappoint and the stock sells off after hours, it will come back up again very fast, because:

 

1) Valuation is low.  Apple should have about $135 per share in cash at qtr-end.  Forward P/E ex-cash is about 8.6, which is absurdly low.

 

2) Apple will soon start paying dividends.  With a yield of 1.8%, the stock will not fall much.

 

3) There are new products on the near horizon.  Institutions will load up in anticipation of a block-buster Christmas qtr.

 

I am going to add to my position after hours, if the stock falls below $590.  I expect that the stock will be north of $700 by year's end.

post #14 of 20
Quote:
Originally Posted by Rogifan View Post

I wish the media would stop with these stupid AT&T and Verizon subsidies stories. Every high-end smart phone is subsidized. Go to T-Mobile's website and practically every Android smartphone is free with contract....and a $350 subsidy. But yet listening to the clowns on CNBC you'd think only Apple is benefiting from subsidies. Give me a break...

 

Technically, you could also get older iPhones for free too..  Furthermore, Apple's subsidy is much greater than most Android phones: $400-$450 for Apple iPhones vs. $320 for Samsung Galaxy phones . I would definitely buy a Galaxy Note if AT&T is willing to subsidize a bit more.

post #15 of 20

26 million iPhones.

 

The stock is going to go down to $200 a share.

Originally posted by Marvin

Even if [the 5.5” iPhone exists], it doesn’t deserve to.
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Originally posted by Marvin

Even if [the 5.5” iPhone exists], it doesn’t deserve to.
Reply
post #16 of 20
Quote:
Originally Posted by Tallest Skil View Post

26 million iPhones.

The stock is going to go down to $200 a share.
Apple beat their own estimates on revenues. It's just some of the wall street clowns predictions 30M+ iPhones.
post #17 of 20

Speaking of AT&T, I'm seriously considering bailing when I get my next iPhone.  Their network has improved since my first iPhone in 2008, but it's still absolutely atrocious compared to Verizon.  

I can only please one person per day.  Today is not your day.  Tomorrow doesn't look good either.  
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I can only please one person per day.  Today is not your day.  Tomorrow doesn't look good either.  
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post #18 of 20
Quote:
Originally Posted by Rogifan View Post
Apple beat their own estimates on revenues. It's just some of the wall street clowns predictions 30M+ iPhones.

 

And since the market actually listens to analysts…

Originally posted by Marvin

Even if [the 5.5” iPhone exists], it doesn’t deserve to.
Reply

Originally posted by Marvin

Even if [the 5.5” iPhone exists], it doesn’t deserve to.
Reply
post #19 of 20
Quote:
Originally Posted by Tallest Skil View Post

And since the market actually listens to analysts…
It's the Gene Munsters of the world that are the problem. He was just on CNBC claiming the calendar Q4 as the biggest product launch in the history of man. Good grief.
post #20 of 20
Quote:
Originally Posted by Tallest Skil View Post

 

And since the market actually listens to analysts…

As I said before, added to position at $568.48.

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