Apple shares jump 3.5 percent on CitiGroup report
Shares of electronics maker Apple Inc. rose sharply in early morning trading on the Nasdaq stock market after an analyst for CitiGroup said the company is likely to beat current quarter Mac sales estimates and continue to see a rise in gross margin.
"Supply chain checks and NPD data suggest meaningful upside to consensus PC unit estimates for Apple in [its fiscal fourth quarter of 2007]," analyst Rich Gardner wrote in a report to clients. "We are raising our September quarter PC unit estimate from 2.0 million to 2.17 million units on stronger than expected iMac momentum following the August 7 product refresh."
Following highly publicized reductions in the iPhone build plan one month ago, the analyst also said he now believes that build plans for the handset have been reduced to "very attainable levels" in the 3.8 million to 4.0 million unit range for calendar year 2007.
"We expect the next revision to iPhone build plan to be an upward revision, especially given the September 5 price reduction from $599 to $399," he wrote. "It has been our view for some time that a significant price reduction would be necessary in order to make iPhone a truly high volume product. Our checks suggest that consumer response to the price cut has been swift and meaningful."
Meanwhile, Gardner raised his fiscal 2008 and fiscal 2009 earnings-per-share estimates on Apple to reflect higher gross margin and lower operating expense assumptions without changing revenue estimates significantly, which remain near consensus estimates.
"Our gross margin revisions reflect our belief that gross margin is likely to continue its upward progression in fiscal 2008 and fiscal 2009 due to above-corporate average margins on iPhone service residuals and accessories," the analyst wrote. "Fiscal year 2008 gross margin should also benefit from the Mac OS Leopard upgrade cycle."
Gardner, who reiterated his Buy rating on shares of the Cupertino-based company, also raised his 12-month price target to $185 from $160. Shares of Apple were trading up 3.5 percent (or over $5) to $149.20.
"Supply chain checks and NPD data suggest meaningful upside to consensus PC unit estimates for Apple in [its fiscal fourth quarter of 2007]," analyst Rich Gardner wrote in a report to clients. "We are raising our September quarter PC unit estimate from 2.0 million to 2.17 million units on stronger than expected iMac momentum following the August 7 product refresh."
Following highly publicized reductions in the iPhone build plan one month ago, the analyst also said he now believes that build plans for the handset have been reduced to "very attainable levels" in the 3.8 million to 4.0 million unit range for calendar year 2007.
"We expect the next revision to iPhone build plan to be an upward revision, especially given the September 5 price reduction from $599 to $399," he wrote. "It has been our view for some time that a significant price reduction would be necessary in order to make iPhone a truly high volume product. Our checks suggest that consumer response to the price cut has been swift and meaningful."
Meanwhile, Gardner raised his fiscal 2008 and fiscal 2009 earnings-per-share estimates on Apple to reflect higher gross margin and lower operating expense assumptions without changing revenue estimates significantly, which remain near consensus estimates.
"Our gross margin revisions reflect our belief that gross margin is likely to continue its upward progression in fiscal 2008 and fiscal 2009 due to above-corporate average margins on iPhone service residuals and accessories," the analyst wrote. "Fiscal year 2008 gross margin should also benefit from the Mac OS Leopard upgrade cycle."
Gardner, who reiterated his Buy rating on shares of the Cupertino-based company, also raised his 12-month price target to $185 from $160. Shares of Apple were trading up 3.5 percent (or over $5) to $149.20.
Comments
Gardner, who reiterated his Buy rating on shares of the Cupertino-based company, also raised his 12-month price target to $185 from $160. Shares of Apple were trading up 3.5 percent (or over $5) to $149.20.
[ View this article at AppleInsider.com ]
I'm starting to get the feeling, Apple has two halos now working for them. Mac unit shipments will be up, iMacs & Books, to be well above their previous guidance.
Under promise / over deliver.
Went to Target over the weekend. Saw the new nano, the one that I said was ugly in another thread. Held it and then ended up buying it. Man I'm a sucker.
Was the RDF turned up this past weekend?
Following highly publicized reductions in the iPhone build plan one month ago, the analyst also said he now believes that build plans for the handset have been reduced to "very attainable levels" in the 3.8 million to 4.0 million unit range for calendar year 2007.
When a lie is repeated incessantly it becomes the truth! I guess this is what happens when so called analysts and so called journalists start believing their own hype.
The rumour that iPhones sales were lagging taken out of the surprise $200 price decrease and had AAPL shares plunge was originated and spread around by the same guys who are now boasting the stock sky high and saying "we knew it all along Apple was having a very strong quarter and selling like crazy". These guys intentionally made the stock go down and are now pushing it as high as possible in order to make a buck. It's no accident. Just look for them, it's easy to realize who they are.
Some others just need to preserve their $200.000+ job and stick "highly publicized" before their statements in order to tell "hey, I just went along with the buzz, I shouldn't be fired for being a bad analyst and, instead of producing well founded analysis, just echo hear-say bs"!
Well founded analysis would at least have produced two scenarios: one that sales were lagging and the other that Steve Jobs/Apple are in this cut-throat business to cut some throats and to become a dominant player! Besides, when was it that Jobs ever came out with optimistic build plans? Apple is well known for being very conservative in their numbers (aka planning) and just about perfect in their component sourcing/build management!
Just watch them build their own network with the Starbuck wi-fi hotspots and come 2009 with the 700MHz frequencies left over from analog tv.
Now don't go turn this into some bs analyst report, ok?!
I had 100% of my IRA money in apple stock since $50 - but it is getting a little rich for my blood so I took it out today at $148.83. If it drops back down a bit I will re-buy (and it seems to always drop after a big run up like this).
If its in your IRA why not just let it ride? You're only raising your taxes when you play the buy/sell game. By selling at 148 what you purchased at $50, you just created a tax liability of about $35 per share that you'll have to pay when you start withdrawing, depending on your tax rate. And why? So you can buy back when it drops to 140? You pay $35 later so you can make $10 now? And there's transaction costs too that you're incurring.
And 100% of your money in AAPL? WTF?!?! Are you craazy? I think AAPL is a great stock, but why not spread out your risk? Its not the only long-term winner in the market.
I had 100% of my IRA money in apple stock since $50 - but it is getting a little rich for my blood so I took it out today at $148.83. If it drops back down a bit I will re-buy (and it seems to always drop after a big run up like this).
I got mine at $7.10 a share
And I'm keeping it right there till ?
Skip
If its in your IRA why not just let it ride? You're only raising your taxes when you play the buy/sell game. By selling at 148 what you purchased at $50, you just created a tax liability of about $35 per share that you'll have to pay when you start withdrawing, depending on your tax rate. And why? So you can buy back when it drops to 140? You pay $35 later so you can make $10 now? And there's transaction costs too that you're incurring.
And 100% of your money in AAPL? WTF?!?! Are you craazy? I think AAPL is a great stock, but why not spread out your risk? Its not the only long-term winner in the market.
I am relatively young (40), and my IRA is an insignificant part of my net worth (because I had it in Nortel stock in my IRA while I worked there). Also, with IRAs you don't pay taxes on the individual transactions, you pay income tax on any withdrawals - my withdrawals would be the same if I bought and sold apple 100 times as if I bought and sold it once, it would not matter at all in the end. Long term gains, short term gains, etc don't matter in IRAs, which is a big part of their appeal for me (no paperwork).
Any my IRA is at scottrade, so the transaction fee was $7 - no big deal. 4000 posts Whohoo!
I see a Tipping Point for Apple. A little traction is going to go a long way. And with Christmas buying season here, the 2008 1st Quarter (starts in Oct for Apple) should be blowout beyond belief.
It should be loads of fun.
I got mine at $7.10 a share
And I'm keeping it right there till ?
Skip
Oh, you just make me sick!
That was almost $65 per share ago . . . or $370,000 that would have been left on the table had I followed his advice.
But then again, like MOST market analysts, he didn't know AAPL from Shinola. I did . . . and do. Thankfully.
McD
If its in your IRA why not just let it ride? You're only raising your taxes when you play the buy/sell game. By selling at 148 what you purchased at $50, you just created a tax liability of about $35 per share that you'll have to pay when you start withdrawing, depending on your tax rate. And why? So you can buy back when it drops to 140? You pay $35 later so you can make $10 now? And there's transaction costs too that you're incurring.
And 100% of your money in AAPL? WTF?!?! Are you craazy? I think AAPL is a great stock, but why not spread out your risk? Its not the only long-term winner in the market.
Not sure you quite understand the concept an an IRA....
... it is getting a little rich for my blood so I took it out today at $148.83. If it drops back down a bit I will re-buy (and it seems to always drop after a big run up like this).
Oops - oh well, it always drops after earnings, when is the next earnings report. Any other good stock buys out there? Google actually looks like a good value to me right now.