“RBC Capital’s Amit Daryanani, reiterating an Outperform rating and a $750 price target [on AAPL], writes that “In recent weeks we have discussed and heard myriad of issues that have lead to AAPL’s under-performance,’ including concerns about gross margin decline, the prospects of new products, the issues of supply constraints for existing products, the fiscal cliff and tax issues in 2013, and the recent management shake-up,'” Tiernan Ray reports for Barron’s. “The company’s projection of a drop to 36% gross margin this quarter ‘is more reflective of their conservative stance and transitory ramp headwinds vs. structural challenges.'”
“Piper Jaffray’s Gene Munster, reiterating an Overweight Rating and a $900 price target, writes that ‘core issue for investors is what Apple’s true margin profile will look like moving forward,'” Ray reports. “Munster thinks margins will stabilize: ‘Our analysis of Apple iOS product margins (components only) suggests that the margin profile for Apple is unlikely to significantly change the company’s overall margin profile despite commentary to the contrary on the Sep-12 earnings call.'”
Ray reports, “William Power of R.W. Baird reiterates an Outperform rating on Apple and a $750 price target, writing that ‘Though obvious from the stock action, recent investor meetings and conversations confirm that investor sentiment has turned decidedly negative. Determining a hard bottom is difficult, though we would note the stock is now trading near its recent P/E trough of roughly 10x forward earnings, with fear creating opportunity.'”
Read more in the full article here.