Bear Stearns: Current Apple weakness is a buying opportunity

“Bear Stearns analysts Andrew J. Neff, William Hand and Ted Chung sent a note to clients Sunday, downplaying current ‘investor anxiety’ for Apple (AAPL) in light of reports that falling NAND memory pricing signals weakness in iPod sales. The analysts maintained their revenue and earnings estimates for the Apple,” The Consumer Electronics Stock Blog reports. Key quotes from the note include, “iPod appears to be tracking down about 20-25% seq, which is still better than Street at ~9-10mm and in line w/ our 10.5mm est. While the Intel transition remains a near-term issue, the CPU biz is now only ~35% of revs, Adobe software w/ native Intel support could come by year end, and AAPL-branded software (Aperture, Final Cut Pro) is due by end of March… Given our confidence in demand for iPods (new products, ongoing leadership) and Macs (potential replacement cycle/new users), we see current uncertainty and stock weakness as a buying opportunity, with AAPL’s P/E at 16x our CY07 operating EPS est. and 18x on Street oper EPS. Despite negative sentiment, we prefer to own the shares when expectations are tempered and maintain our CY06 target of $103.”

Full article here.

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Related article:
Citgroup analyst expects ‘fairly eventful’ Apple announcement around 30th anniversary on April 1st – March 13, 2006
Citigroup ups Apple to ‘buy,’ expects Intel transisiton to be complete in all Macs by August – March 13, 2006

3 Comments

  1. Nice to see some positive comment after watching the stock move down incrementally for several weeks.

    As a long term AAPL investor I’ve had continued confidence in spite of ups and downs.

    “GROSS” is the only word that describes much of the analyst reporting. They hype things with their “inside” analysis of the market and then poo poo when their crystal balls are cloudy.

    Apple gave financial guidance for the current quarter, but “ANALysts” have hyped things beyond the guidance, now if the quarter does not meet the hype then the AAPL stock price will pay for it by shrinking.

    Oh well, that’s why we invest for the long run. Go Steve!

    PS: I bought a new MacMini Solo yesterday for my 53″ TV. It works great.

  2. I wonder is most analysts were SOUTHERN if they would be kinder and easier on AAPL.

    When Apple gives guidance below analyst expectations, analysts should consider why they are guiding low. Is it because analysts are hyping their numbers anyway and Apple is accounting for that? Is Apple being very conservative and worthy of a kick in the pants for underguiding? Is Apple truly expecting a lack luster quarter?

    Apple and only Apple knows what’s in the pipline. Making wild guesses and then punishing Apple when the guess is incorrect hurts everyone.

    I think the $66 AAPL price is a real discount. It was an even better bargain Friday at $63 and change.

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