WR Hambrecht initiates Apple coverage with ‘Buy’ rating, $110 price target

Apple StoreWR Hambrecht + Co have initiated coverage of “PC company and consumer electronic powerhouse, Apple, Inc., with a Buy rating and a $110 price target.”

Apple has a very impressive desktop and notebook offering that continues to grow faster than the industry and command higher ASPs, an iPod franchise that dominates the category and represented almost half of total Company revenues in the strongest quarter in its history, Dec. ’06, a new OS due out shortly that is expected to help facilitate operating both Mac OS X and Windows OS through virtualization software, an upcoming iPhone offering in the ~1B unit total cellphone market, and numerous other products and initiatives in-place and on-going which should continue the successful metamorphosis of Apple Computer into Apple, Inc, a full-blown consumer electronics powerhouse that successfully combines hardware and media offerings.

We believe that new product offerings expected this year will continue to drive growth for Apple and are establishing a price target of $110, which is based upon 30x (Apple’s forward estimated organic earnings growth rate) our C2007 EPS estimate-ex interest income and options expense, plus ~$13.50 in cash per share.

Full report (.pdf) here.

[Thanks to MacDailyNews Reader “Mike in Helsinki” for the heads up.]

Related articles:
Apple’s Schiller: No virtualization in Mac OS X 10.5 Leopard, ‘our solution is dual boot’ – July 10, 2006

Morgan Stanley reiterates Apple ‘buy’ – says market is underestimating iPhone demand – March 01, 2007
Needham raises price target on Apple Inc. to $135 from $115 – January 29, 2007
Slew of analysts up price targets on Apple Inc. – January 18, 2007

4 Comments

  1. “a new OS due out shortly that is expected to help facilitate operating both Mac OS X and Windows OS through virtualization software”

    Ah… not really. They seem to be implying that BootCamp is virtualization; they really mean Parallels. At least I’d get the impression that the virtualization solution was included out of the box if I read this without prior knowlege.

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