Will Apple shares ‘break out’ over earnings?

“Apple reports earnings next Tuesday, and while the shorts and naysayers continue to beat the uncertainty drum, the company is probably sitting prettier than any other big name in big name tech nowadays. We can harp on recession worries, though Steve Jobs himself tells me that it’s a non-issue for his company,” Jim Goldman writes for CNBC. “Further, he scoffed at my suggestion that Apple is pricing itself out of competition with high-priced Macs, the iPhone and Apple’s iPods since all have seen noticeable price drops and the company, for the first time in its history, offers a broad array of products with a broad range of price tags. It’s a good and fair point.”

“There’s been a lot of debate about the iPhone sales figures. I’ve read the blistering comments about my coverage of Steve Jobs’ announcement at Macworld that Apple sold a staggering 4 million iPhones in its first 200 days on sale–which apparently was a disappointment to some because there was a 5-million figure floating around,” Goldman reports. “Listen, from the very beginning I said the 5-million figure, when it first started making the rounds, was a pipedream at best. But the mere fact that it was indeed ‘around,’ and that Apple reported 4 million instead was the likely reason for the stock decline on the news. Jobs tells me he’s thrilled with iPhone sales thus far, and he should be. The figure is extraordinary, no two ways about it.”

“Apple sits at the center of the digital entertainment revolution, and it’s only just beginning. Forget about the short-term vagaries plaguing tech and the macro environment. Longer term, I can’t see a company better positioned to take advantage of the biggest trends entertainment and tech have seen since the net itself,” Goldman reports. “I can’t remember the last time Apple shares were this weak going into earnings, following Macworld. I’ve talked to a number of insiders and analysts who say shares seem to be setting up for a nice pop if Apple can blow through its earnings as the company has done in the past. Of course, if Apple misses for some reason, it would be devastating. But for once, expectations seem dampened around these shares, despite today’s moderate rally in the issue. That’s unusual and might offer investors, willing to roll the dice, a nice opportunity.”

Full article here.

17 Comments

  1. “Will Apple shares ‘break out’ over earnings?”

    WTF? Apple shares with ‘break down’ over <strike>earnings</strike> losses. The Wow is Now, folks. Microsoft’s magnificent Windows Vista is tops in sales and customer satisfaction and there’s no stopping the mighty Redmond machine now. Vista’s windows have transparency now, but more importantly, you can play games in Vista and MACs are too expensive. Suck it, MAC lemmings.

    Your potential. Our passion.™

  2. Vista Sux!,
    My New system at work is Vista and out of the box, I had to reformat the drive and reinstall it and it still is, as slow as poo in a glacier and crashes as often as three drunks on a bicycle built for one.

  3. Hard to say where the market is headed. When Politicians start getting involved calling for Recession Aid, you know there’s a problem bigger than what anyone is saying. Market slides over the past few weeks underscore it.

    The subprime market problem has yet to hit bottom. If a recession unfolds, Dow will shrink back to low 11,000, perhaps high 10,000. Apple stock may see $140 before $200.

  4. AAPL is fairly stable in an unstable and changing marketplace. They have market capitalization of 141B. They have 15B cash in the bank. They have four major market areas: computers, iTunes/iPod, iPhone, and now Apple TV movie rentals. Oh yes, and they also have Mr. Steve Jobs helming this magnificent ship into the future. All very good indicators.

    I just instructed my broker to buy more AAPL before Tuesday’s earnings report. Yes, its a calculated risk, but I’m in for the very long term. Damn the torpedoes, praise the Lord and pass the ammunition!

  5. The Dow is flirting with 12,000, and the other major indices are at significant support/resistance points. Should the current levels be taken out, watch out below. Apple will be fine in the long run for the reasons mentioned by iWill, but intermediate term could see a significant drop should the indices fall below their near-term, major support areas. It’s possible, given market conditions, that AAPL will see a very nice pop after earnings, but that there will be heavy selling into this rise by institutions (when you have a huge number of shares, you have to exit when the market lets you). Generally speaking, the market trumps whatever an individual stock is doing.

  6. As zune points out through irony Vista’s appalling satisfaction value of 21% (half of XP’s which is itself a unloved turd) does give Apple a fantastic opportunity to further push home their clear technological and satisfaction (81%) advantage. As things stand they don’t have to try that hard to attract disaffected Windows users and one can only imagine the contrast between the smiles in SJ’s office as opposed to SB’s office these days, but as OSX comes to dominate the non desktop arena so the transformation will continue unabated and the potential of the shares longer term have no real ceiling.

    Indeed can Steve Ballmer be long for this World of the living?

  7. How is it Gates gets a pass by intimating they have sold over a 100 million copies of Vista? That is a bit disingenuous to its shareholders! I guess we’ll see what shakes out come Thursday.

    From my Touch.

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