RBC cuts March estimates, sees Apple's momentum returning in the second half of 2013

Posted:
in AAPL Investors edited January 2014
RBC Capital Markets on Friday cut its estimates for Apple's just-concluded March quarter, citing apparent weakened demand, but the firm also believes that the iPhone maker could pick up steam in the second half of the year.

RBC


Analyst Amit Daryanani of RBC cut is price target for AAPL stock from $600 to $550, while reducing his projected sales for the March quarter. He has modeled for Apple to sell 35 million iPhones and 18.3 million iPads in the three-month span.

His new March projections of $41.2 billion in revenues and $9.59 earnings per share are below Wall Street expectations of $42.7 billion in revenues and $10.08 earnings per share.

Daryanani has also cut RBC's estimates for Apple's in-progress June quarter, when he believes the company will earn $37.3 billion in revenues and $8.72 earnings per share. Those numbers are also below market consensus, as the analyst believes Apple will be affected by product transitions during the quarter.

He sees iPhone units dropping to 28.6 million in the June quarter, while iPad sales are forecast to be around 19 million.

But beyond what he called the "June trough," Daryanani believes Apple could see some of its momentum return in the second half of calendar 2013. He sees a number of catalysts on the horizon, including anticipated debuts of iOS 7 along with a next-generation "iPhone 5S" and a more affordable new iPhone model.

The same analyst reported last month that he believes Apple will launch "multiple new phones" in the June-July timeframe. Specifically, he expects that a new low-end iPhone with a plastic casing could be Apple's way of addressing the entry-level smartphone market, where the company currently does not compete.

Beyond the iPhone, other potential boosts for Apple later this year include carrier expansion to partners like China Mobile, which is the largest wireless provider in the world, as well as the possibility of new products, like a full-fledged Apple television set or a smart wrist watch accessory.

While RBC's price target calls for AAPL shares to grow 29 percent to $550, the firm does also offer "upside" and "downside" scenarios, in which shares could swing as high as $700 or as low as $350. Despite the lower price target, RBC has maintained its "overweight" rating on Apple.

Comments

  • Reply 1 of 17
    Another stupid monkey revising his PT in response to the share price. Btw, Apple does have a cheaper phone: the iphone 4 and 4S. Btw, apple does have different screen size: the iphone 4 and iphone5
  • Reply 2 of 17


    Double yawn.

  • Reply 3 of 17
    slurpyslurpy Posts: 5,190member


    What the **** would a bank know about Apple's momentum?

  • Reply 4 of 17
    e1618978e1618978 Posts: 6,075member


    RBS said that Apple was going lower back in 2009 when it hit $77.

     

  • Reply 5 of 17
    SpamSandwichSpamSandwich Posts: 31,491member
    Hahahaha! Oh, these threads slay me.
  • Reply 6 of 17
    philboogiephilboogie Posts: 7,494member
    I don't get the math: 434: up by 29% is 559, up 60% is 711, down 17% is 360
  • Reply 7 of 17
    solipsismxsolipsismx Posts: 19,566member
    philboogie wrote: »
    I don't get the math: 434: up by 29% is 559, up 60% is 711, down 17% is 360

    Beats me. Do you have to insert them into a machine on a mysterious island every 108 minutes?
  • Reply 8 of 17
    MacProMacPro Posts: 18,443member
    philboogie wrote: »
    I don't get the math: 434: up by 29% is 559, up 60% is 711, down 17% is 360

    Reminds me of my dad teasing me when I was about 6 or 7 and trying to understand fractions. He'd point out 6 was half as much again as 4, then add, 'but then 4 is two thirds of 6' ... I remember my brain hurt.
  • Reply 9 of 17
    solipsismxsolipsismx Posts: 19,566member
    edit: Read backwards the first time but not after it was submitted. Weird.
  • Reply 10 of 17
    jfc1138jfc1138 Posts: 3,090member

    Quote:

    Originally Posted by tobeornottobe View Post



    Another stupid monkey revising his PT in response to the share price. Btw, Apple does have a cheaper phone: the iphone 4 and 4S. Btw, apple does have different screen size: the iphone 4 and iphone5


    And it has a really BIG screen one: the LTE iPad mini..... and a SUPER-BIG screen one, the LTE iPad4 lol....


     


    Both, btw, cheaper to own and operate since they don't carry those unused voice contract penalties....

  • Reply 11 of 17
    jollypauljollypaul Posts: 328member

    Quote:

    Originally Posted by sog35 View Post


    All based on pure speculation.



     


    It's called investing. [pushes chips on to double zero] Come on, baby needs a new iPad!

  • Reply 12 of 17
    al_bundyal_bundy Posts: 1,525member

    Quote:

    Originally Posted by sog35 View Post


    yawn.  Another anal-list allowing short-term supply issues to determine target price.  All based on pure speculation.



    the 4S had supply issues, for months


     


    the iphone 5 is being discounted all the time

  • Reply 13 of 17

    Quote:

    Originally Posted by digitalclips View Post




    Quote:

    Originally Posted by PhilBoogie View Post



    I don't get the math: 434: up by 29% is 559, up 60% is 711, down 17% is 360




    Reminds me of my dad teasing me when I was about 6 or 7 and trying to understand fractions. He'd point out 6 was half as much again as 4, then add, 'but then 4 is two thirds of 6' ... I remember my brain hurt.


    A real problem when you're trying to calculate the percentage change in the value of one currency against other: the percentage appreciation from one currency's pov is not the same as the percentage depreciation from the other currency's pov.


     


    Some call it the "divisor problem."

  • Reply 14 of 17
    malaxmalax Posts: 1,598member


    "sees Apple's momentum returning in the second half of 2013"


     


    I think someone doesn't understand the concept of "momentum."

  • Reply 15 of 17
    vl-tonevl-tone Posts: 337member


    RBC? You mean the Canadian bank that suddenly decided to replace all employees of one of their branch with cheap foreign workers while making billions of profits? And to add insult to the injury they wanted the soon jobless employees to train their replacements? Yeah sure I trust them... image


     


    http://www.ctvnews.ca/canada/rbc-apologizes-to-employees-affected-by-outsourcing-decision-1.1233754

  • Reply 16 of 17
    AAPL's decline has been really painful.
    Hopefully, there's some good news when the results are announced.
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