Citigroup analyst less than bullish on Apple

Apple Store“To characterize Apple’s first-quarter earnings as excellent is the epitome of understatement. In the first three months of the year, profit ballooned by 88%, to $770 million. The per-share earnings of 87 cents made Wall Street forecasts of 64 cents to 67 cents look downright conservative… There’s reason to expect the good times to last. Demand for Macintoshes and iPods is robust, and the forthcoming iPhone music-playing wireless device is expected to be a huge sales catalyst,” Arik Hesseldahl reports for BusinessWeek.

Hesseldahl reports, “Indeed, it would appear that everyone loves Apple these days, if not for the likes of Citigroup analyst Richard Gardner. He’s covered Apple for about 10 years, and even as his counterparts at other firms gushed, Gardner urged caution: Hold the Apple stock you have, but don’t buy any more, for now.”

“It’s probably not right to describe Gardner as ‘bearish’ on Apple. ‘To be clear, we have no issue with medium- to long-term fundamentals on Apple,’ he says in his note. ‘Our modeling simply suggests that forthcoming products like the iPhone are fairly reflected,” in earnings estimates,'” Hesseldahl reports.

Hesseldahl reports, “His argument is simple: Much of the good news that investors can expect from Apple, whether it’s related to the iPhone, AppleTV, Macs, or iPods, is already accounted for in the stock price.”

Full article here.

21 Comments

  1. You know it seems to me that these guys act like they have some special angle on , and that they know something no one else sees.

    If the iPhone goes nuts the stock price will raise. If it just sits there the stock will lose some value.

    So what do these guys have (info wise) for us… NOTHING! as in thanks for nothing.

    And when they are way off base they can hurt a company and I’ll bet that they have buried some companies, F***in jerks.

  2. Is the prospect of Apple obtaining 25%+ of the desktop market in the current price? No. That’s why it’s a no-brainer tp see aapl @ $300-$800+ in five years. Wake-up fools.

  3. To Gardner:

    Smart investors buy and HOLD for the LONG TERM. Repeat, buy and hold for the long term.
    Have you ever heard of Warren Buffet? He (and Peter Lynch of Magellin fame) say buy and hold for the long term. I think AAPL by all measures fits that, doesn’t it? Continual buying and selling usually only benefits the brokerage firms and the genuses that work there.

  4. How can one be sure all the good news is in the stock when the economics of the iPhone are still unknown. When Apple announces that they will get maybe $5 per month per iPhone user, ALL the earnings estimates will go up. Wait for it…and watch it unfold. WORD.

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