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UBS raises Apple price target to $100

post #1 of 26
Thread Starter 
On the heels of Apple's announcement that it sold 14 million iPods and achieved revenues of $5.7B last quarter, UBS Investment Research on Wednesday raised estimates and increased its target price on the company's shares to $100.

"While expectations ran high heading into this keynote in terms of product possibilities, we believe Apples performance in 1Q06 far outweighs any product announcements made (or not made) at the event and should drive momentum in shares," analyst Ben Reitzes wrote in a research note sent to clients.

"We are excited about the new Intel Macs and other software products announced at Macworld and believe that Apple continues to innovate and is set to announce several new products over 2006 -- including a new media server, an Apple branded cell phone and additional media content," Reitzes added.

The analyst also noted that some "widely anticipated" products were not announced at the show, but says he is not concerned.

"While no new iBook was introduced, it was offset by an iMac announcement and we believe an iBook is likely coming within a quarter or two anyway," Reitzes wrote. "We had discussed a media hub, but the new Macs are so powerful -- they are already hubs -- and we continue to believe a hub should be coming later this year with Intels Viiv."

The analyst said he continues to believe a new video download service and new iPod shuffle will also appear soon.

Given prospects for higher iPod sales and the positive impact on accessories, downloads, and more, UBS said it is raising estimates on Apple through fiscal year 2007.

For 2006, the firm raised its earnings-per-share (EPS) estimate to $2.33 from $2.10 based on 55-percent year-over-year revenue growth to $21.5B. For 2007, UBS estimates Apple to earn $2.80 a share based on 18-percent revenue growth to $25.8B.

The firm maintains a 'Buy' rating on Apple stock.
post #2 of 26
Wow-- two forcasts for $100. I am loving this. If this keeps up, I will come out of grad school with more money than when I went in!
There's no there there. But, I'm working on it.
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There's no there there. But, I'm working on it.
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post #3 of 26
It seems as though the analysts are coming around to my estimates. I've already given an estimate of $100 share price in an earlier thread in response to someone saying that I should have dumped my shares at $75.

I said that it would go to over $80 from the show and the analysts call on the 16th or 18th. As Apple released some figures early, it's started already. Though we need the margins, the profits, and the breakdowns.
post #4 of 26
So how should someone like myself go about getting shares in Apple? I remember when they were at $20-30 a share. Do you guys use eTrade or something of the likes online?
post #5 of 26
I didn't wait for the analysts. As soon as I read 14 million ipods sold on one of the sites providing MWSF updates, I called my broker and bought back in. I had made the horrible mistake of selling on hearing of the Intel switch in June. Then iPod sales went up and along with it the stock. This last quarter, iPod sales went absolutely crazy. I feel I have now somewhat rectified my June error.

If just 5% of the iPod purchasers switch from Windows and buy a Mac. Apple's stock will continue to double every year for a while.
just waiting to be included in one of Apple's target markets.
Don't get me wrong, I like the flat panel iMac, actually own an iMac, and I like the Mac mini, but...........
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just waiting to be included in one of Apple's target markets.
Don't get me wrong, I like the flat panel iMac, actually own an iMac, and I like the Mac mini, but...........
Reply
post #6 of 26
Quote:
Originally posted by crees!
So how should someone like myself go about getting shares in Apple? I remember when they were at $20-30 a share. Do you guys use eTrade or something of the likes online?

I'm not a day trader. I have a broker at WM. I've know him for over yen years. I'd rather pay the fees, and get the personal attention when it is needed because he can alert me to incidents that might be important when I'm not in a position to find out about them myself.

You have to be careful about taxes, unless you are trading in an IRA or other tax free account, more than you have to be concerned by brokerage fees.

Most people who are day traders seem to not do well. It's too easy to pull the trigger when the costs seem to be that low. It leads to indiscretion.

Now is a difficult time to get in. There is no guarantee that there won't be profit taking at these high levels before the stock starts to rise again. this is why I wait.

Some wise guys told me that I should have sold at $75, then I could have bought back in at $71.50. From their mouths to god. Right?
post #7 of 26
www.Sharebuilder.com is a great site if you just want to do one time trading such as buying a stock (Apple) and watching it grow. $4 a trade a deal you can't beat. Great for beginning traders.

www.Scottrade.com is another great site at $7 trade for more serious people. Beats e-trade and Ameritrade for cost wise IMO.

I used to use a broker but I got so tired of their recommendations and pushy sales pitches instead of what I wanted and paying $50 a trade I thought was too high for something I could do just as easily. Check out Sharebuilder, you'd be surprised at how easy it is to buy stock. They offer EFT for transfering funds from your Bank to their account. I have an account with them as well as with Scottrade because I like to do mutual funds and ShareBuilder does not allow you to invest in high risk stocks or MFunds.

sorry about making this sound like a sales pitch, I didn't intend it to sound that way, I just remember when I wanted to get into it and I had no idea how to do it without a broker, but I am sure glad I ditched my broker. My only other sugguestion is, make sure you have a tax person when it comes time to do your taxes.
post #8 of 26
Just wanted to point out that the iPod division has just surged beyond more than half of Apple revenues this past quarter.

14M iPods at $188 average revenue per iPod equals $2.6B. I think the ARPU has moved up from $188 to about $200 since the 5G is a big seller, 4G nanos are more popular than 2G (whereas before 4G minis were more popular than 6G minis), and shuffle sales have cooled.

Add in other music products (iTMS sales, iPod accessories) revenue of $265M (same amount as previous quarter) and you have $2.865B, which is slightly more than half of $5.7B. But I'm certain other music products have zoomed way over $300M. So it's likely that iPod now accounts for around 55% of revenue, Mac for 45%.

Now, the Mac is still growing, just much slower than iPod. Mac sales of 1.25M units is the best since Christmas 1999. It's only slightly more (1%) than the previous quarter of 1.236M, but around 19% more than Christmas 2004. So it's a little bit better than the y-o-y overall PC sales increase. I think the ARPU has stayed about the same ($1300-$1330 range) since the Mac mini started shipping in quantity.
"you will know the truth, and the truth will
set you free."
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"you will know the truth, and the truth will
set you free."
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post #9 of 26
Quote:
Originally posted by nofear1az
sorry about making this sound like a sales pitch, I didn't intend it to sound that way, I just remember when I wanted to get into it and I had no idea how to do it without a broker, but I am sure glad I ditched my broker. My only other sugguestion is, make sure you have a tax person when it comes time to do your taxes.

Sales pitch not at all, that's exactly what I was looking for. Thanks!
post #10 of 26
Also wanted to point out one more thing: Jobs said iTMS music rate is now 3M per day. That's more than double the rate through most of last year (1.2 to 1.5M per day). And it duplicates the doubling in rate right after last year's Christmas break (from around 600K to 1.2M).

Qualifier: Apple seems to have stopped announcing milestones so this doubling effect could've begun anytime after 10/25 (Apple said over 650M songs at that point).

Anyway, assuming no more growth (ha!) or a constant 3M sales per day going forward, Apple should be holding its one billionth iTMS song promotion beginning mid-Feb, with the billionth song due to be sold on Feb 28th (but probably earlier due to the promotion creating more sales).
"you will know the truth, and the truth will
set you free."
Reply
"you will know the truth, and the truth will
set you free."
Reply
post #11 of 26
Quote:
Originally posted by nofear1az
www.Sharebuilder.com is a great site if you just want to do one time trading such as buying a stock (Apple) and watching it grow. $4 a trade a deal you can't beat. Great for beginning traders.

www.Scottrade.com is another great site at $7 trade for more serious people. Beats e-trade and Ameritrade for cost wise IMO.

I used to use a broker but I got so tired of their recommendations and pushy sales pitches instead of what I wanted and paying $50 a trade I thought was too high for something I could do just as easily. Check out Sharebuilder, you'd be surprised at how easy it is to buy stock. They offer EFT for transfering funds from your Bank to their account. I have an account with them as well as with Scottrade because I like to do mutual funds and ShareBuilder does not allow you to invest in high risk stocks or MFunds.

sorry about making this sound like a sales pitch, I didn't intend it to sound that way, I just remember when I wanted to get into it and I had no idea how to do it without a broker, but I am sure glad I ditched my broker. My only other sugguestion is, make sure you have a tax person when it comes time to do your taxes.

If you want to buy a stock, and then just sit on it, that's fine.

But the problem is that the low fees encourage people to trade, and that's where they get into trouble. Most people with these accounts don't realise, even though they are told, is that they are margin accounts. So, you have to be careful. It takes time for a trade to close (money transferred, etc.), if you trade before that happens, you are using margin. People get caught on that. Be careful!

You should never listen to a broker, or any other adviser, unless you know their record well. I would never take any advice from a broker without doing my own due diligence first. If you do, and you have a loss, it's your own fault, not the brokers. Remember that. It's always your fault.
post #12 of 26
Quote:
Originally posted by crees!
So how should someone like myself go about getting shares in Apple? I remember when they were at $20-30 a share. Do you guys use eTrade or something of the likes online?

yea when the stock is at its highest point is always the best time to buy. "Buy high and sell lo..." wait how does that saying go again?
post #13 of 26
Quote:
Originally posted by mike12309
yea when the stock is at its highest point is always the best time to buy. "Buy high and sell lo..." wait how does that saying go again?

The idea is to buy into a rising market, and sell into a falling one. Not quite the same thing.

You can't tell what the maximum price will be (well, you can within reason).

So, as of a few moments ago, the price was $84.46 (from my real-time account). If you feel that it will go up enough to account for brokerage fees and taxes, then you can consider it. Anything above that will be profit.
post #14 of 26
Quote:
Originally posted by melgross
The idea is to buy into a rising market, and sell into a falling one. Not quite the same thing.

You can't tell what the maximum price will be (well, you can within reason).

So, as of a few moments ago, the price was $84.46 (from my real-time account). If you feel that it will go up enough to account for brokerage fees and taxes, then you can consider it. Anything above that will be profit.

I think the guy was being sarcastic... I think.

Proud AAPL stock owner.

 

GOA

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Proud AAPL stock owner.

 

GOA

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post #15 of 26
Quote:
Originally posted by SpamSandwich
I think the guy was being sarcastic... I think.

I know he was. I just wanted to clarify things a bit.
post #16 of 26
Quote:
Originally posted by melgross
I know he was. I just wanted to clarify things a bit.

so is a good idea to buy? When do stocks usually split at?
post #17 of 26
If the new posters on the board here are indicitive of renewed interest in Apple's stock, I can imagine a whole lot of uneducated people getting into the stocks as speculators again. I think I smell the unhealthy whiff of the 90's pre-crash market drifting into the room.

Proud AAPL stock owner.

 

GOA

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Proud AAPL stock owner.

 

GOA

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post #18 of 26
Quote:
Originally posted by Cato988
so is a good idea to buy? When do stocks usually split at?

I think that it's still a good time. As it approches 90, though, the upside becomes less tangible. From 90 to 100 is 10%. That's not bad, but how long will it take to get there, and what flips will we see on the way? We'll have to see how sales of the new machines do, as well as sales of the now soon-to-be-discontinued PPC machines.

As far as splits are concerned, I wouldn't worry about them. They give no useful benefits. It makes the stock cheaper for those who don't like the idea of an expensive stock. But it doesn't make the stock go up more than a little bit while we're waiting for the moment of split to arrive, and then, often enough, it will go down slightly as soon as it's done.

A split is usually a sign that management is confident that the stock will continue to rise, or at least not fall. It's also a way of getting more people to buy that now "cheap" stock.

But, don't base a buy on that. Base it on the performance of the company.
post #19 of 26
Quote:
Originally posted by SpamSandwich
If the new posters on the board here are indicitive of renewed interest in Apple's stock, I can imagine a whole lot of uneducated people getting into the stocks as speculators again. I think I smell the unhealthy whiff of the 90's pre-crash market drifting into the room.

Right now, Apple has a healthy 73+% institutional investment, and this is rising. That's pretty high. It shows confidence in the companies direction, and its management. That couldn't be said in the late '90's, when I last invested in them.
post #20 of 26
Quote:
Originally posted by melgross
Right now, Apple has a healthy 73+% institutional investment, and this is rising. That's pretty high. It shows confidence in the companies direction, and its management. That couldn't be said in the late '90's, when I last invested in them.

I got caught with a few dot bombs back then... anyone remember USWeb/CKS (aka marchFIRST)? That one still stings.

Proud AAPL stock owner.

 

GOA

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Proud AAPL stock owner.

 

GOA

Reply
post #21 of 26
is there a widget that keeps track of apple stock changes?
post #22 of 26
Quote:
Originally posted by Cato988
is there a widget that keeps track of apple stock changes?

Not that I know of. Why don't you try one? If you can (it's supposed to be easy),, let us know.
post #23 of 26
I love posting these articles. There is some very interesting thinking around.

http://www.businessweek.com/technolo...111_378241.htm
post #24 of 26
Quote:
Originally posted by Cato988
is there a widget that keeps track of apple stock changes?

The built in stock ticker widget?
post #25 of 26
Quote:
Originally posted by melgross
Not that I know of. Why don't you try one? If you can (it's supposed to be easy),, let us know.

haha i cant make a widget
post #26 of 26
Quote:
Originally posted by Cato988
haha i cant make a widget

Actually, ther's software out there that makes it real simple.
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