“Bear Stearns lowered estimates for Apple Computer on Friday to reflect more pronounced iPod seasonality, but maintained an ‘outperform’ rating on the stock based on valuation and foreseen second-half strength. ‘Our view is that investors should take advantage of current weakness, viewing Apple as a compelling second-half play, though the risk is that our outlook is somewhat based on products not announced or seen yet,’ wrote analyst Andrew Neff in a report Friday,” Maya Roney reports for Forbes.
“Neff cut his fiscal third-quarter iPod unit estimate to 8 million from 8.9 million but said Intel-based Macs and music would drive earnings in the back half of the year,” Roney reports. “Neff said Apple’s valuation looked attractive at 17 times his calendar 2007 operating earnings-per-share estimate. He reduced his calendar 2006 target to $90 from $94 but said he remains a buyer of the stock. ‘Apple’s stock is dependent on major new product launches,’ the analyst noted. ‘We’re comfortable that Apple will continue to innovate, which we reflect in its multiple, but the timing and customer reaction are always speculative.'”
Full article here.
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