“Just as the bearish sentiment in Apple (AAPL) hits a cyclical peak, the company is about to deliver the biggest earnings blowout in the history of the world. We’re talking about the mother of all earnings blowouts,” Andy Zaky writes for Seeking Alpha. “Well maybe not that big, but certainly the largest blowout in company history without question.”
“While everyone focuses on whether the passing of Steve Jobs marks the end of Apple, or whether the Amazon Kindle Fire will kill the iPad, the company is quietly selling millions upon millions of iPhones that far exceed even the most rosy expectations,” Zaky writes. “The largest company in America is about to grow its earnings by a whopping 84% this quarter, and Wall Street is asleep at the wheel.”
“We expect Apple to conservatively report that it shipped 32-40 million iPhones, far ahead of the 25 million iPhones that Wall Street expects out of the company,” Zaky writes. “That will be the largest gap between Wall Street expectations and actual results since the iPhone was first introduced in 2007.”
Zaky writes, “Yet, not only do we believe that Apple will comfortably ship 32 million iPhones without a hitch, we think our expectations will actually prove too conservative. In fact, we believe that Apple will actually end up reporting sales of more than 35 million iPhones which will cause the heart attack of at least several hundred short sellers.”
Read more in the full article here.
3GS&4S here baby!
This would certainly be true if the ONC-NAP were reversed and followed the CSCO-KIDD path of least resistance.
Agreed. A TOST analysis (+-PBAJ towards BUN) of mobile unit sell-throughs factoring in the usual PANCO vectors (including emerging markets) suggests what every iPhone customer knows from their own personal experience trying to buy one – the iPhone 4S is AAPL’s hottest product ever.
The question investors will ask after the earnings report is if this indicative of a great product or a great company. The more Wall Street focuses on AAPL product as aberration, as if each hit is luck rather than the product of a well-oiled hit machine, the more the stock suffers.
What’s needed is a wholesale reevaluation of what AAPL has become through the wide angle lens of a BACN analysis so that its total value, beyond any individual product, is as clear as the PIE chart that presents the results.
STFU
LMFAO
+1
I love that technical talk.
For some reason I always get hungry after reading his posts.
Wall Street does treat Apple as an aberration. Where every company were lapping up to Wall Street’s guidance and wisdom, Apple is the only odd man out. Apple prospered and the companies that follow Wall Street’s wisdom have to pay the piper and lost their shirts off their backs. And boy, Wall Street really hates Apple. Apple not only beats Wall Street, but it rubs Wall Street in the nose. Apple is the rare company on Wall Street that has zero debt. That means Wall Street banks does not earn a single cent from Apple for fat fees and consultancy fees.
Wall Street has not only destroyed many companies but it has destroyed the economies of the Western world. Yet they were powerful enough to get bail-out money from the bureaucrats at public expense. Except for Bernard Madoff who suckered many of the smart people from Wall Street to invest in his Ponzi schemes (HSBC and Citibank are some of the greedy victims) I have not heard of anyone from the rogue banks being jailed. The same people are still running the show.
As for the careerist Wall Street analysts, they have time and time again screwed up and always missed out on Apple. It is because they are beholden to Wall Street and so do not dare to go against the sacrosanct Wall Street’s orthodoxy. They will be punished if they do. For more detail on this part, please download and listen to the podcast titled “Exile on Wall Street” on WYNC’s Leonard Lopate Show from the iTunes Podcast store. Wall Street analyst Mike Mayo, who worked at six Wall Street firms, analyzing banks and protesting against bad practices for two decades, discusses the role of finance and banks in the US. In Exile on Wall Street: One Analysts Fight to Save Wall Street.
LOL… 🙂
The mother of all MDN headlines.
3GS is still pricy in all non-contractual markets, and iPhone 4S was not even on sale in most markets with billions of people of population.
So these 33-38 million iPhones predictions are only to hype up expectation and play on share price once it will fall after actual results will “not meet estimations” (not Apple’s, but of these analysts).
That said, Apple might easily have record-breaking $40 billion quarter (with 25 million iPhones, say).
What makes you think that Apple products have to be dirt cheap to make money? AAPL already takes in over half of all the profits in the cell phone market. Market share measured in units is not Apple’s game. Just look at NOK to see how well that has played out.
NOK is one thing, but LESF ratio leans towards EIJS support level, so we have only AFAIDK chart picture.
As to cheap matter, I did not say that Apple needs cheap to make money. I said that Apple’s sales can not jump from 17 million to 38 million through only moderate price fall on iPhone 3Gs, and that iPhone 4S was not even on sale for the most of this quarter in most of territories worldwide.
you might think so, but a lot of 3GS owners will have skipped the iPhone 4, and have now upgraded to the 4S. This helps bump the sales this quarter. Not to mention, there was a record-breaking launch weekend for the 4S at 4 million units.
17million was a low (in anticipation of a new model), and therefore 25m is a no-brainer. 32m is certainly doable.
Stories like this are THE reason Apple stock remains stagnant. They make such grandiose predictions that no company no matter how well it does can ever live up to.
Damn straight, rp2011. These ridiculous “street” estimates
are AAPL’s worst enemy (except maybe for Eric Schmidt).
True, so now is not a good time to buy stock. Wait til after they announce record blowout earnings, wait for it to drop $28, then buy as much as you can!
AAPL shares short as of 30 Nov : 11.62M
Not all that many, although the number is up from the month before. As we get closer to earnings in January, I expect the SP to be rising. Anyone who doesn’t get scared into covering by that, will be bleeding from the eyeballs within seconds of the company announcement, and I could feel any less sorry for them.
Expect AAPL stock to drop by about 4% because the earnings weren’t way larger than anyone dreamed. Investors think the earnings are already ‘baked in’ to the stock price.
Apple is still seen as a niche player by most people because the vast majority of people use Microsoft Windows and thusly are biased against Apple.
When are common investors going to wake up to the fact that the stock market is a rigged game, with little to no relation between company performance and stock performance? If a big investment house can make money by depressing the price of Apple stock, they will do so.
——RM
At least you seem to realize the market dynamics where Apple is concerned. Most of the Apple bulls don’t see there are dozens of John Corzines and Bernie Madoffs running Wall Street. Both Dediu and Zaky only see visions of pure numbers dancing in their calculator heads. They fail to see that those numbers are meaningless in a rigged market. For some reason the Apple bulls are expecting Apple’s share price to soar to the heavens if Apple manages to surprise Wall Street with their “blowout” numbers. First of all, Wall Street’s whisper numbers may exceed Apple’s “blowout” numbers. Secondly, even if Apple does exceed those whisper numbers, there’s absolutely no guarantee that the share price will go up more than 10%, putting Apple back to where it already was two months ago at around $425.
Apple shareholders are getting consistently fooled by the analysts who basically pump Apple’s share price only to short it upon earnings. Even as Apple sells products by the tanker-load, Apple’s share price continues to fall, day after day. If they can’t see that much, then I feel sorry for them. Believe it or not, I’m Apple long since 2004 and have made plenty from Apple and I have no intention of selling since the company itself is solid and may give back some small gains from time to time. Monster gains just seem too unlikely at this point considering how relatively flat Apple shares have been compared to earnings.
” Apple’s share price continues to fall, day after day.”
Hyperbole much? The stock has floated up and down in the 370-410 range for a while now. You make it sound as if the stocks losing 2-3% per day. If you believe Apple will continue to grow, and with their smal marketshare in PCs and phones and the China factor theres no reason to think they wont, then it will be inevitable that the stock will have to go up to shadow the dropping P/E ratio, even if it is still at a bit of a discount.
The only factors stopping it really are a probable second recession after Europe implodes. Even so Apple’s core fundamentals are still strong.
http://www.appleinsider.com/articles/11/11/27/apple_the_most_undervalued_large_cap_stock_in_america.html
Agreed. A BUTTR analysis (+-PBAJ towards BUN) of mobile unit sell-throughs factoring in the usual EIGG vectors (including emerging markets) suggests what every iPhone customer knows from their own personal experience trying to buy one – the iPhone 4S is AAPL’s hottest product ever.
The question investors will ask after the earnings report is if this HAMM indicative of a great product or a great company. The more Wall Street focuses on AAPL product as aberration, as if each hit is luck rather than the product of a well-oiled hit machine, the more the stock suffers.
What’s needed is a wholesale WEINR reevaluation of what AAPL has become through the wide angle lens of a BACN analysis so that its total value, beyond any individual product, is as clear as the PIE chart that presents the results.
Barring, that a TUMS analysis will supercede the HRTBRN factor for a rosy XCRMNT at the end of the day.
Apologies Squiggles…couldn’t help myself.
A very tasty analysis indeed, I must say.
*burp*
Who is the predator and who is the prey?
“… Apple will actually end up reporting sales of more than 35 million iPhones which will cause the heart attack of at least several hundred short sellers.”
IOW: All those ‘canny’ short sellers turn out to be the prey. And they deserve it.
*crunch*crunch*crunchy*crunch*
high sales does not always equal high stock price. So who knows if shorts will eat it. Longs have been eating it for quite some time with this low P/E apple’s been trading at lately.