Apple (AAPL) Q1 Earnings Preview
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Apple, Inc. (NASDAQ: AAPL) shares are trading higher today, ahead of its first quarter earnings release, expected on January 25, 2010, after the market closes. Shares are down 1.6% today to $208.26 .
Apple shares have seen a 13.7% increase through the quarter, and rose $144.2% through 2009. For comparison, the Computer Hardware industry is up about 134% for 2009.
Data from Bloomberg has 39 analysts with a Buy rating on AAPL, 4 have a Hold, and 2 suggest to Sell. The analyst average price is $245.17, the high is $280, and the low is $220.
Apple is expected to report an EPS of $2.05 and revenues of $12.03 billion. For Q409, AAPL posted an adjusted EPS of $1.82, which topped estimates by $0.40, and revs of $9.87 billion. A year ago saw Apple with an EPS of $1.78 and revs of $10.1 billion, both beating estimates.
NEWS THROUGH Q110:
October saw Apple begin an agreement with TELUS (NYSE: TU) to begin selling the iPhone in Canada, both the 3G and 3GS versions.
China also struggled to adapt to the iPhone in early November, as consumers weren't willing to pay the introductory price of $730 - $1,020.
The iPhone began to sell in RadioShack (NYSE: RSH) stores in November, adding another outlet for Apple to capitalize on sales. Shares of RSH are u 14% since the announcement.
Apple may have seen some downside as Verizon (NYSE: VZ) launched an ad campaign against AT&T (NYSE: T) stating that their U.S. coverage had some fairly large holes in it.
Apple announced a Jan 27th event, which is expected to include the unveiling of the Apple tablet.
Other items that have been news include the "Google Phone," and a stall in iPhone sales in NYC by AT&T. All of these events may or may not be fully priced in by the time earnings emerge.
ANALYST RATING CHANGES:
B of A Merrill Lynch and Oppenheimer raised their price targets on Apple in early October. B of A maintained a Buy, and set their price target to $220 from $185. Oppenheimer maintained an Outperform rating, and raised their price target to $210 from $185.
Kaufman Bros raised their price target from $184 to $214, and maintained the Buy rating. Click Here for more color [made October 2, 2009].
UBS upgraded Apple to Buy and raised their price target to $265 from $170. At the time, this was the new 'Street' high price target.
BMO upped Apple to a $210 price target, from $185, and maintained their Outperform rating.
Susquehanna reiterated their Positive rating, and raised their price target to $10 from $185.
Canaccord Adams maintained their Buy rating while raising their price target on AAPL to $250 from $200.
Deutsche Bank raised their price target on AAPL to $250 from $225.
In November, Needham & Co. downgraded Apple from Strong Buy to Buy, while maintaining their $235 price target. Click Here for more color on the downgrade [November 17, 2009].
Jesup & Lamont initiated coverage on AAPL with a Buy rating and $240 price target.
Broadpoint.AmTech reiterated a Buy, and lifted their price target to $260 from $235. Click Here for more color.
At the end of December, Kaufman raised their estimates on AAPL, anticipating a 'blowout' quarter. They maintained a Buy rating and raised their price target to $253 from $235. Click Here for the article.
SUMMARY:
Apple is slated to unveil their anticipated Tablet device on January 27, 2010, just days after their Q110 earnings release. The tablet, though a known device for some years now, could be as much a game changer as anything else that Apple has produced (no pun intended). Though with the emergence of smaller "Netbooks" to the market, smarter phones, and reduction of data pricing across the board by service providers may stem some of the excitement duley deserved for the tablet. Knowing Apple, and the limitless creativity that Steve Jobs possesses, it's almost certain that they wouldn't release this sort of product out of desperation rather than a good time in the market.
Also, Google has partnered with HTC to create a phone that could very well rival the iPhone. Many speculators turn to the available applications and technology behind the duo, but needless to say, with the market for smartphones tapering slightly, the profits from the iPhone may not be as good as they once were unless Apple switches to a different provider to initiate more growth from a whole new customer base. If they switch though the may see lower margins.
Also, keep an eye on Chinese sales. In a market that is known for counterfeiting, and Apple setting the price rather high, a lower price could change the minds of many in a country that is not only emerging but chock-full of people (approx. $1.33 billion, or 4.4x the U.S. population).
Apple will issue its Q110 results via press release at approximately 4:30 PM (EST) on January 25, 2010. Stay tuned to StreetInsider.comcom's Earnings section to see our analysis of the highly-anticipated quarterly results within seconds of their release.
Apple shares have seen a 13.7% increase through the quarter, and rose $144.2% through 2009. For comparison, the Computer Hardware industry is up about 134% for 2009.
Data from Bloomberg has 39 analysts with a Buy rating on AAPL, 4 have a Hold, and 2 suggest to Sell. The analyst average price is $245.17, the high is $280, and the low is $220.
Apple is expected to report an EPS of $2.05 and revenues of $12.03 billion. For Q409, AAPL posted an adjusted EPS of $1.82, which topped estimates by $0.40, and revs of $9.87 billion. A year ago saw Apple with an EPS of $1.78 and revs of $10.1 billion, both beating estimates.
NEWS THROUGH Q110:
October saw Apple begin an agreement with TELUS (NYSE: TU) to begin selling the iPhone in Canada, both the 3G and 3GS versions.
China also struggled to adapt to the iPhone in early November, as consumers weren't willing to pay the introductory price of $730 - $1,020.
The iPhone began to sell in RadioShack (NYSE: RSH) stores in November, adding another outlet for Apple to capitalize on sales. Shares of RSH are u 14% since the announcement.
Apple may have seen some downside as Verizon (NYSE: VZ) launched an ad campaign against AT&T (NYSE: T) stating that their U.S. coverage had some fairly large holes in it.
Apple announced a Jan 27th event, which is expected to include the unveiling of the Apple tablet.
Other items that have been news include the "Google Phone," and a stall in iPhone sales in NYC by AT&T. All of these events may or may not be fully priced in by the time earnings emerge.
ANALYST RATING CHANGES:
B of A Merrill Lynch and Oppenheimer raised their price targets on Apple in early October. B of A maintained a Buy, and set their price target to $220 from $185. Oppenheimer maintained an Outperform rating, and raised their price target to $210 from $185.
Kaufman Bros raised their price target from $184 to $214, and maintained the Buy rating. Click Here for more color [made October 2, 2009].
UBS upgraded Apple to Buy and raised their price target to $265 from $170. At the time, this was the new 'Street' high price target.
BMO upped Apple to a $210 price target, from $185, and maintained their Outperform rating.
Susquehanna reiterated their Positive rating, and raised their price target to $10 from $185.
Canaccord Adams maintained their Buy rating while raising their price target on AAPL to $250 from $200.
Deutsche Bank raised their price target on AAPL to $250 from $225.
In November, Needham & Co. downgraded Apple from Strong Buy to Buy, while maintaining their $235 price target. Click Here for more color on the downgrade [November 17, 2009].
Jesup & Lamont initiated coverage on AAPL with a Buy rating and $240 price target.
Broadpoint.AmTech reiterated a Buy, and lifted their price target to $260 from $235. Click Here for more color.
At the end of December, Kaufman raised their estimates on AAPL, anticipating a 'blowout' quarter. They maintained a Buy rating and raised their price target to $253 from $235. Click Here for the article.
SUMMARY:
Apple is slated to unveil their anticipated Tablet device on January 27, 2010, just days after their Q110 earnings release. The tablet, though a known device for some years now, could be as much a game changer as anything else that Apple has produced (no pun intended). Though with the emergence of smaller "Netbooks" to the market, smarter phones, and reduction of data pricing across the board by service providers may stem some of the excitement duley deserved for the tablet. Knowing Apple, and the limitless creativity that Steve Jobs possesses, it's almost certain that they wouldn't release this sort of product out of desperation rather than a good time in the market.
Also, Google has partnered with HTC to create a phone that could very well rival the iPhone. Many speculators turn to the available applications and technology behind the duo, but needless to say, with the market for smartphones tapering slightly, the profits from the iPhone may not be as good as they once were unless Apple switches to a different provider to initiate more growth from a whole new customer base. If they switch though the may see lower margins.
Also, keep an eye on Chinese sales. In a market that is known for counterfeiting, and Apple setting the price rather high, a lower price could change the minds of many in a country that is not only emerging but chock-full of people (approx. $1.33 billion, or 4.4x the U.S. population).
Apple will issue its Q110 results via press release at approximately 4:30 PM (EST) on January 25, 2010. Stay tuned to StreetInsider.comcom's Earnings section to see our analysis of the highly-anticipated quarterly results within seconds of their release.
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