Cowen raises Apple target to $135, sees 80M iPhones shipping this holiday

Posted:
in AAPL Investors edited October 2015
Ahead of Apple's September quarter earnings report, investment firm Cowen and Company on Monday increased its price target to $135, with sales forecasts higher than consensus on Wall Street.




Analyst Timothy Arcuri believes Apple this week will report sales of 50 million iPhones and 9.5 million iPads, on its way to yet another record quarter. Revenue for the quarter is expected to be around $51.5 billion, with $1.87 earnings per share.

Looking ahead to the December frame, Arcuri sees Apple shipping between 78 million and 80 million iPhones during the quarter, which would be yet another record for the company. He has increased his projected revenues for the December quarter to $80.1 billion, with an earnings per share estimate of $3.34.




Arcuri sees iPhone sales continuing to grow on strong demand from China, where the iPhone 6s launched on day-one. He also expects ongoing momentum from users switching from Android handsets, and also demand upside from the new Apple iPhone Upgrade Program.

And in 2016, Arcuri believes Apple could help boost sales mid-cycle with a refreshed, smaller 4-inch iPhone. Arcuri's supply chain sources have indicated that the company has worked on a new 4-inch handset, serving as a successor to the iPhone 5s.

Despite increasing his price target, Arcuri has maintained a "market perform" rating on shares of AAPL. He said on Monday that the company's stock has "broadly entered a holding pattern, albeit with upward bias."

Apple will report the results of its September quarter after markets close on Tuesday. AppleInsider will have full coverage.
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Comments

  • Reply 1 of 52
    rogifanrogifan Posts: 10,669member
    Here's what's so perverse about Apple. Going into earnings we have a bunch of nervous nellies with their iPhone fears. Part of the reason the stock was down 3% today when a lot of tech stocks were up big. Yet according to posters on Phillip Elmer Dewitt's blog the "whisper numbers" for the quarter have been creeping up. And now we have this from Cowan. So on the one hand you have iPhone fears driving the stock down and on the other estimates being raised which will also drive the stock down when Apple reports and doesn't exceed the "whisper numbers". Apple is set up to fail no matter what while Google, Amazon, Microsoft and Facebook are all at record highs.

    And now the day before earnings Reuters is out with a hit piece about ?Pay growth slowing according to a research firm no one has ever heard of. I doubt the timing of the story is coincidental.

    http://finance.yahoo.com/news/apple-pay-growth-slows-launch-192349208.html
  • Reply 2 of 52
    tedktedk Posts: 16member
    Exactly, Rogifan. The Street players will hold back AAPL as needed to help their positions, but they can't hold it down forever. (I hope.)
  • Reply 3 of 52
    I call a bottom! This is surely capitulation when sog35 wants to sell !:D
  • Reply 4 of 52
    tedktedk Posts: 16member
    Quote:
    Originally Posted by sog35 View Post

     

     

    just wasting your breath.

     

    None of this will ever change unless Apple's goes private.

     

    I'm done with this piece of shit stock.  Once I get a decent price I'm selling everything.  The only way I'll buy Apple stock again is if its undervalued by 50% or they go private.

     

    Apple is a stock to trade.  Buy on the rumor, sell on the news.

    Buy right after earnings, sell right before dividends.

    Absolutely pathetic that a $700 billion stock gets tossed around like a cheap trick.




    Apple is not going private.  The stock is pretty much undervalued by 30-50% now - see consensus price targets and its PE ratio.  Also, if it goes private, then you can't buy it, right?  Apple gets ridiculously manipulated and it's proof of how screwed up the market is.  Meanwhile it's huge and growing fast - you can't suppress the truth forever.  Long term hold.

  • Reply 5 of 52
    tedktedk Posts: 16member
    Quote:

    Originally Posted by sog35 View Post

     

     

    Oh yes they can.  Wall Street has held down Apple's share price for most of the last 10 years.

     

    Even when Apple was growing revenue and profits over 100% YoY they still did not get a PE over 20.  Right now Microsoft has a PE of 35 with 5% revenue growth.

     

    There were 2 exceptions: late 2012 and early this year.  Besides that Apple has been held down 20-40% lower than its fair value.

     

    It will never change.  When Wall Street firms buy and sell the same 1,000 Apple shares back to each other THOUSANDS of times a day, they can easily drop the price any time they want.  All the need to do is setup their algo machines and keep buying and selling shares for 1 cent less. Do this thousands of times and the stock drop like today.




    sog, look at the ten year chart and tell me the company's value isn't going up - from about 8 ten years ago to a high of 130, let's say.  That's a 15 fold increase, which turns molehills into mountains, but it takes patience.

  • Reply 6 of 52
    levilevi Posts: 344member
    sog35 wrote: »
    just wasting your breath.

    None of this will ever change unless Apple's goes private.

    I'm done with this piece of shit stock.  Once I get a decent price I'm selling everything.  The only way I'll buy Apple stock again is if its undervalued by 50% or they go private.

    Apple is a stock to trade.  Buy on the rumor, sell on the news.
    Buy right after earnings, sell right before dividends.
    Absolutely pathetic that a $700 billion stock gets tossed around like a cheap trick.


    You have a short memory Sog. Apple was trading at about $105 a year ago, and in the $70s 2 years ago. Perhaps the problem is your perspective which seems focused on short term gains. Us with a longer perspective are happy to see you go.
  • Reply 7 of 52
    bobschlobbobschlob Posts: 1,074member
    Quote:

    Originally Posted by sog35 View Post

     
    Quote:
    Originally Posted by Rogifan View Post



    Here's what's so perverse about Apple. Going into earnings we have a bunch of nervous nellies with their iPhone fears. Part of the reason the stock was down 3% today when a lot of tech stocks were up big. Yet according to posters on Phillip Elmer Dewitt's blog the "whisper numbers" for the quarter have been creeping up. And now we have this from Cowan. So on the one hand you have iPhone fears driving the stock down and on the other estimates being raised which will also drive the stock down when Apple reports and doesn't exceed the "whisper numbers". Apple is set up to fail no matter what while Google, Amazon, Microsoft and Facebook are all at record highs.



    And now the day before earnings Reuters is out with a hit piece about ?Pay growth slowing according to a research firm no one has ever heard of. I doubt the timing of the story is coincidental.



    http://finance.yahoo.com/news/apple-pay-growth-slows-launch-192349208.html

     

    just wasting your breath.

     

    None of this will ever change unless Apple's goes private.

     

    I'm done with this piece of shit stock.  Once I get a decent price I'm selling everything.  The only way I'll buy Apple stock again is if its undervalued by 50% or they go private.

     

    Apple is a stock to trade.  Buy on the rumor, sell on the news.

    Buy right after earnings, sell right before dividends.

    Absolutely pathetic that a $700 billion stock gets tossed around like a cheap trick.




    Funny thing; you would think most powerful company in the world would have some pull with the SEC (and even with POTUS). Wall st should be under the brightest spotlight and the strongest magnifying glass, as it relates to their dealings with AAPL stock.

    It would be the best thing Tim Cook could do for Apple shareholders.

    Make some calls, Tim!

  • Reply 8 of 52
    tedktedk Posts: 16member
    Quote:

    Originally Posted by sog35 View Post

     

     

    But look at the PE ratio.  Even with 100%-200% revenue growth the last 5 years Apple's PE rarely went over 20.

     

    Sure the stock went up 15x.  But earnings and revenue went up 30x.

     

    It all comes down to risk vs reward.  Even if Apple reports record breaking profits the stock still can slump 15% like it did in July.  I have no time for that shit.


     

    I hear you.  I know of several long-time longs who've recently sold because of the market's bullshit casino factor.  It's very frustrating.

  • Reply 9 of 52
    As long as Apple pays a dividend, that definitely needs to be factored in to the eval of whether it is a good investment. Let us suppose that in the next three years, Apple introduces products (or products mature and are adopted) which change the landscape of our daily life. This will change the eval of the company from a "one-trick pony" (iPhone), and the P/E will be seen differently. This might be the last time you can invest this cheap, as if this quarter is as "underperforming" as many people seem to think, the stock could go back down near 100. Another possibility is 2nd calendar quarter of 2016, when the populace has absorbed their christmas and new years devices and not much new is appearing. That could be a low. Other than that, only a general recession or various cataclysms will slow this puppy down. If you don't believe it, invest in something else (and let me know what it is!) Dude! Woof woof! Surf's up gotta go!!
  • Reply 10 of 52
    fallenjtfallenjt Posts: 3,960member
    My investment in AAPL at $118 and I ain't sell a share.
  • Reply 11 of 52
    totaltotal Posts: 83member

    AAPL is today down -3% because one of their suppliers Dialog Semiconductor (DLG; -20 %), reported bad results and bad outlook. Ofcourse it says nothing about AAPL, lets see tomorrow i see it like roulette, in July everyone expected stock price will go higher and it dropped. now it can be opposite. On the other hand, my experience is, that most of the time when GOOG or MSFT go higher after results, AAPL is going down. Lets see tomorrow! 

  • Reply 12 of 52
    rogifanrogifan Posts: 10,669member
    levi wrote: »
    You have a short memory Sog. Apple was trading at about $105 a year ago, and in the $70s 2 years ago. Perhaps the problem is your perspective which seems focused on short term gains. Us with a longer perspective are happy to see you go.

    For me it's not about the short term. It's about Apple having a PE of 13 while Google's is 30 and Microsoft's is 36. And according to the talking heads on CNBC both of those stocks are "cheap". Last quarter Apple's revenues were up 30%+ YOY, they beat top and bottom line guidance and EPS and the stock tanked because it didn't meet some stupid "whisper numbers". Microsoft had nothing close to 30% YOY revenue growth yet their stock is up over 12% the last two days.
  • Reply 13 of 52
    sog35 wrote: »
    Return YTD:
    Apple 4%
    Nasdaq 6%

    Return 1 year:
    Apple 8%
    Nasdaq 10%

    Return 3 year:
    Apple 38%
    Nasdaq 68%

    Those returns are unacceptable for an individual stock versus a broad indicator with much less risk like the Nasdaq.
    And this is despite Apple crushing the Nasdaq in revenue growth and profits.

    Bottom line is investing in Apple is not worth the risk anymore.  Even if they dominate the market they still get punished.

    And stop calling Apple a one trick pony.  Apple's non-iPhone revenue is LARGER than the entire Google revenue.  So if we are going to ignore Apple's iPad/Mac/Services revenue than you need to ignore the entire Google.  Its ridiculous that Apple gets punished for dominating the most lucrative product in the history of man.

    Yikes. Sog, you nailed it. It is ridiculous.

    Aside from privatization, might there be something structural that Apple can do to change this story? Sometimes I wonder if AAPL might be SO large a part of the stock market that there are gatekeepers holding it to the floor to prevent an insane reaction in, I dunno, maybe AMZN or the like, which would distort everything and make a mess. Hell, I guess AAPL distorts everything and makes a mess all by itself. :\

    There's got to be some gambit that would convince the street. Split the shares? Spin off a division? Increase the dividend? I bet Cook is having to deal with this right now. He knows AAPL will get hammered again and again and that hardly makes that employee stock compensation worth doing if the new hire has to wait 5 years for it to appreciate 5%!!
  • Reply 14 of 52
    bobschlobbobschlob Posts: 1,074member
    Quote:

    Originally Posted by sog35 View Post

     
    Quote:
    Originally Posted by BobSchlob View Post

     



    Funny thing; you would think most powerful company in the world would have some pull with the SEC (and even with POTUS). Wall st should be under the brightest spotlight and the strongest magnifying glass, as it relates to their dealings with AAPL stock.

    It would be the best thing Tim Cook could do for Apple shareholders.

    Make some calls, Tim!


     

    Or Apple could avoid this crap and just go private.




    I'd rather see most powerful company in the world kick the s*** out of Wall st manipulators. Rather than just take their ball and go home.

    (But, if not one; then the other.)

  • Reply 15 of 52
    Quote:

    Originally Posted by Levi View Post





    You have a short memory Sog. Apple was trading at about $105 a year ago, and in the $70s 2 years ago. Perhaps the problem is your perspective which seems focused on short term gains. Us with a longer perspective are happy to see you go.

     

     

    Quote:

    Originally Posted by TedK View Post

     



    sog, look at the ten year chart and tell me the company's value isn't going up - from about 8 ten years ago to a high of 130, let's say.  That's a 15 fold increase, which turns molehills into mountains, but it takes patience.




     
    Originally Posted by Rogifan View Post





    For me it's not about the short term. It's about Apple having a PE of 13 while Google's is 30 and Microsoft's is 36. And according to the talking heads on CNBC both of those stocks are "cheap". Last quarter Apple's revenues were up 30%+ YOY, they beat top and bottom line guidance and EPS and the stock tanked because it didn't meet some stupid "whisper numbers". Microsoft had nothing close to 30% YOY revenue growth yet their stock is up over 12% the last two days.

     

    IMO, you're both right. Big money is being diverted to the "high flyers". It sucks, but it's the truth.

    PE should definitely be more like 18...which will it'll be closer to than 13...but patience is key (unfortunately).

     

    Sog should sell soon AND stop whining. Investors like him get tiring real fast.

  • Reply 16 of 52
    bobschlobbobschlob Posts: 1,074member

    It's really up to Tim Cook to deal with this Wall St. BS (nobody else is going to).

    I know he doesn't like to think about it; just wants to focus on customers; provide grrrrreatest experience… blah blah blah. But enough is enough. This crap can't go on.

  • Reply 17 of 52
    ac1234ac1234 Posts: 138member

    sog & Rogifan - spot on.  I finally broke down and joined AI to support your views.  I have been bitching about Apple's poor stock performance on MR.  I'm certain that some manipulation is at play.

     

    However, I think Cook and his team have done a very poor job in looking out for shareholders and dealing with the Wall Street components of their roles.  The Edifice Complex is at play big time.  More staff, more buildings, distracted on social engineering = lack of innovation = low p/e from the street.

     

    Note to Phil - your ass can't innovate.  Eddie Cue looks like he is on a disrespectful ego trip at most of the sessions.  Cook is probably the worst presenter I have experienced at this level.  Maybe the problem is that he has nothing that impressive to present.  Wow - middle finger emojis.  No video content deals of note, no 4k capability in their new Apple TV, no chops !!

     

    AAPL is now trading about where it was 3 years ago and $100,000,000,000 on buybacks have been wasted.

  • Reply 18 of 52
    ac1234ac1234 Posts: 138member



    Bob - whay can't it go on?  Been over 3 years with no end in sight.  Jeff Bezos and Elon Musk have little or no profits - but as executive visionaries and leaders they know how to work Wall Street.  Tim & Company spend too much time on their social agendas and coordinating their WWDC presentation costumes and one liners ("...can't innovate anymore my ass...").

     

    Maybe Angela, the latest empty suit (skirt), will find a way to earn the $70,000,000 Apple paid to get her in the first year.

     

    YUK !!!

  • Reply 19 of 52
    Quote:

    Originally Posted by BobSchlob View Post

     

    It's really up to Tim Cook to deal with this Wall St. BS (nobody else is going to).

    I know he doesn't like to think about it; just wants to focus on customers; provide grrrrreatest experience… blah blah blah. But enough is enough. This crap can't go on.




    Really, you should just stop. stop.

    PE is at 13. Dark matter is not taking over the earth.

     

    So what do you propose Tim should do? Bragging about upcoming products or posting premature sales results will do nothing in the long term.

     

    Stopping the buy backs and paying out more in dividends may temper fluctuations...or it may not.

     

    But stop saying Tim should "deal with this". Like what?

  • Reply 20 of 52
    bobschlobbobschlob Posts: 1,074member
    Quote:

    Originally Posted by drewys808 View Post

     
    Quote:
    Originally Posted by BobSchlob View Post

     

    It's really up to Tim Cook to deal with this Wall St. BS (nobody else is going to).

    I know he doesn't like to think about it; just wants to focus on customers; provide grrrrreatest experience… blah blah blah. But enough is enough. This crap can't go on.




    Really, you should just stop. stop.

    PE is at 13. Dark matter is not taking over the earth.

     

    So what do you propose Tim should do? Bragging about upcoming products or posting premature sales results will do nothing in the long term.

     

    Stopping the buy backs and paying out more in dividends may temper fluctuations...or it may not.

     

    But stop saying Tim should "deal with this". Like what?




    Read my earlier posts.

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