In a note to clients today, Piper Jaffray analyst Gene Munster raised estimates on Apple (AAPL) across the board:
• Estimates for September to EPS of $1.17 vs. Street at $1.11, and revenue of $8.37b vs. Street at $8.07b: These revisions are based on the most recent NPD growth rates; we are incrementally more confident in Sept. quarter Mac, iPod and iPhone units.
• 2.8 million Mac units (vs. 2.5m previously): Through the first two months of the Sept. quarter (July and Aug.), Mac NPD data is up 32% y/y. In the month of July, NPD data was 43% y/y and in Aug. units were up 23% y/y. However, we note that Aug. was a tough comp, as a redesigned iMac was released in Aug-07. But even if we assume continued y/y growth of 23% in the month of Sept. (which we believe is conservative), the overall y/y growth rate for the full quarter would come in at 29%, implying 2.8m Macs in the Sept. quarter.
• 11 million iPod units (vs. 10.8m previously): Through the first two months of the Sept. quarter (July and Aug.), iPod NPD data is up 16% y/y. If we assume continued y/y growth of 16% in the month of Sept., then factor in the average overshoot of 7% that NPD has had on actual iPod units over the last 8 quarters. These factors result in an overall growth rate of 9%, implying just over 11m iPods.
• 5.0 million iPhone units (vs. 4.1m previously): In our upwardly revised model we have increased our iPhone unit estimate to 5m from 4.1m for the Sept. quarter. We are more comfortable with a 5m unit estimate given Apple sold over 1m units in the first three days of availability of the iPhone 3G (July 11-13).
Piper Jaffray maintains their “Buy” rating on AAPL (“Alpha List”) with a $250 price target.
Yes, but Shaw Wu was down on AAPL recently.
Well …… Wu Hooooooo
Poo Wu
2.8 millions Macs?
I think I see a tipping point.
If it is 2.8m Macs it will be a great disappointment – only 96,000 more and they will have sold 10m in a year…
You can’t depend on this Munster guy. He always exaggerates about Apple’s sales. WS will take one look at Apple’s numbers this quarter and knock the stock down $10. Yeh, I guess there is some sort of tipping point. The more Macs Apple sells, the more the stock goes down. This is not going to be a good year for Apple investors no matter how many Mac, iPods or iPhones are sold.
Nowadays, even strong companies are not favored on WS. Everything is done for short-term gains. Apple’s stock price is so manipulated that it won”t matter what the numbers are, it’s not going anywhere. A crooked economy and crooked day traders. I think Goldman Sachs just recently downgraded Apple and the bloodbath has already begun.
@iphonerulez who says: ‘He always exaggerates about Apple’s sales.’
Evidence please…?
I’m not hopeful you can provide any of course. In my past experience he’s been right.
“crooked day traders” … day traders can be as crooked as they dare to be, they don’t control the market. And a “crooked economy”? That’s you and me, my man. You and me.
Apple stock prices have never made sense to me. Oh, I could make reasonable predictions most of the time, but not sensible ones. “The stock will drop shortly after the MWSF keynote” has been true much more often than not for nearly a quarter of a century. Just as “the stock will rise ahead of any major announcement”.
AAPL is going up. There will be some “down”, as well, but mostly it will be “up”. It will go down when the Big Boys take their profits and up when they see the chance to make more. Given the Leading P/E, there is a lot of room for making more – a lot of incentive to get back in after the price has dropped a bit.
Nothing “crooked” here. A little short-sighted, perhaps, but that isn’t “crooked”. OTOH, I always worry about the numbers that are based on early sale of something we could see coming. Those first few days of iPhone2 sales should have been bundled with the sales from the previous month when buyers slacked off while waiting.
Ups Apple to what…..It seems no matter how much good news about Apple the stock still continues to tank. This is the second time it has tanked down from near $200 per share down to the $130’s. Good grief why does Apple’s stock tank so much??? This is getting ridiculous. I mean if the stock went down say $10 per share because of the economy I could understand But $40, $50, $60 and $70 per share??
Something’s not right folks.
I don’t know where to find proof. My wording is probably not right. When I say crooked I was using similar wording to what I’ve seen on other discussion boards about how WS is somehow rigged in favor of hedge funds or something like that. I don’t know if it’s true, but people that claim to understand the market say these things and I repeated them.
Munster’s always the analyst that has the highest estimates and targets and they’re way off of whatever WS is expecting. WTF is the sense of giving a target price of $250 when any fool can see Apple doesn’t stand a prayer of getting anywheres near that. Wouldn’t it make sense to lower it to say $170. That’s at least seems somewhat reasonable. What he must be giving is some theoretical number that has nothing to do with reality of the market as a whole. In a way it seems like a deception.
Maybe someone could explain to me what the $250 target price represents. I know he has a year’s leeway (less now), but Apple probably won’t be hitting that in even a year. Even if Apple sells millions and millions of computers. Apple is going to priced relative to the rest of the market. It can’t be an exception. It’s likely to reach $110 before it reaches $185 this year.ffff
Like the man says, no matter how good the news, Apple still seems to tank. Blame it on the economy or the market or whatever, I’m just calling it as I see it. If this keeps up I would think that even long-term investors will get fed up and go to some other stock. I’m not, but seemingly earnest investors want buybacks and dividends and stuff. They just seem dissatisfied nowadays. I don’t see the future very well as many of you do, so I’m at a major disadvantage.
OK, I’ll be happy to be considered the idiot among geniuses, so tell me which direction Apple is headed when earnings are announced. If what Munster is saying is true about the numbers and stuff, then Apple’s share price should go up, right? And you’re all willing to stake your lives on it.
“You can’t depend on this Munster guy. He always exaggerates about Apple’s sales.”
Munster’s company makes money every time you buy and sell Apple stock. Buy, Sell they don’t care, they make money either way. Therefore they need to perpetually build it up and smash it down to keep the money coming in. As a general strategy Gene plays the cheerleader whenever the market has hammered Apple. When the market hasn’t hammered Apple for a while, he does.
“Like the man says, no matter how good the news, Apple still seems to tank.”
Because massive growth over the next decade is already factored into Apple’s stock price. When good growth appears instead, the price will go down.
Lets say Apple doesn’t grow at all, it’s worth in the $70’s.
Lets say by some miracle Apple grows at current rates for a decade and keeps margins the same. it would be worth around $400.
So small changes in predictions of future growth can have a big effect on any stock price.
Gene Munster is a Mactard scum, licking Jobs’ boots.