Apple analysts scramble to lower their June estimates

“Although Apple investors are plenty nervous about next week’s March quarter earnings report, the stock’s drop to 16-month lows this week may have more to do with jitters about the next report — the one for the quarter that ends in June,” Philip Elmer-DeWitt reports for Fortune.

“The Street’s consensus as of Friday, according to Thomson Financial’s survey of 44 analysts, is for Apple to report fiscal Q3 earnings of $9.08 per share on sales of $38.91 billion,” P.E.D. reports. “Those numbers are down $1.5% and 1%, respectively, from just last week, thanks in part to a flurry of newly lowered estimates. Between Tuesday and Friday, at least eight Apple analysts warned their clients that Apple’s June quarter could be another tough one.”

Read more in the full article here.

MacDailyNews Take: Go as low as you like; better low than too high.

26 Comments

    1. Google quietly beat and went up $34. No questions asked. Wall Street and shareholders all happy. Don’t expect Apple to get even close to that. Apple shareholders will be very, very lucky if Apple doesn’t drop $34. There is no joy in Mudville…

  1. So is this the NEXT round of AAPL manipulation?

    Lowered expectations!

    Then Apple comes in with yet-another brilliant result. But this time the lowered expectations are beaten, therefore buy Buy BUY! Gotta hate these manipulative parasites.

    Meanwhile, we here all know AAPL has no sane excuse to EVER drop out of the $700 range. Wag the dog, etc.

  2. This was silly enough once AAPL fell below $500. But now that it’s even below $400, all logical reason has long since left the discussion. There is absolutely no sane reason on the planet for the stock’s price right now. Therefore even if Apple strongly beats estimates this week, I have no good feeling either way as to what the stock will actually do anymore.

  3. A lowered consensus estimate for fiscal Q3 earnings is $9.08 per share on sales of $38.91 billion? And that is throwing Wall Street into a panic?

    First of all, it is an estimate. The majority of the pro analysts have a *very* poor track record in making estimates for Apple. Years of history demonstrate the futility of their efforts. Second, there are still incredibly large numbers by anyone’s viewpoint. Considering that the 3rd quarter is not the strongest, even these reduced estimates translate to annual earnings of over $40 per share and total annual revenues in excess of $160B. Even at a conservative P/E multiple, that translates to a stock value in the range of $400 to $500. Factor in the cash and securities and you reach $500 to $600 plus. And all of that is based on some pretty dismal assumptions. Pardon me if I don’t sell my tiny piece of Apple in a blind panic.

  4. It’s a fiendish plot carefully and cruelly inspired to drive Apple fanboys mad with worry and apprenhension. You say this is no logical reason for this wild stock fluctuation? Well, you are the reason and these dastardly machinations are working perfectly! (insert evil laughter)

  5. Actually I like Steve Jobs could give a rats ass what the stock price does. I Am a big Apple fan. But the stock price has nothing to do with the company Apple it has to do with stock-price only. The market sycophants will do what they will do. But Apple as a company will continue to innovate and create wonderful great products for the rest of us continue to make mountains of cash and pileup more more cash into their hundred and $137 billion Cash Hoard. I don’t worry about Apple as a company with no debt and mountains of cash and great products they will do just fine let the stock do what the stock will do.

    1. — although its true that Jobs said that he didn’t understand why apple stock price goes up and down and he prefers to focus on the topline (products) and let the bottomline (money) take care of itself implying that he wasn’t bothered with stock price, note that Jobs said that when the stock was continuously growing.

      There have been cyclic drops but never like this, Jobs never lost 250 Billion $ of investors money. Besides the cyclic drops were also quickly followed by bounce backs. Other drops besides cyclic like the 2008 recession it dropped in TANDEM with other stocks, now appl is dropping when others are going up (recently aapl fell to 52 week low while Goog hit its 52 week high). Apple stock is now way lower in P.e of the S&P average. It’s way lower than the P.E of Msft which has never happened for years.

      I believe that if Jobs was alive now, losing 250 billion of investors money and the P.E at 9. he wouldn’t be so sanguine about the stock price , (but then again if Jobs was alive I don’t think the stock would have fallen so much: see item 5).

      Remember that Jobs ALSO famously held that he didn’t believe in dividends but apple gives dividends now, things change…

      2) Note also that apple has a legal obligation to shareholders.

      Look at Apple’s own Corporate Governance Guidelines item Number One:
      —–
      The Board oversees the Chief Executive Officer (the “CEO”) and other senior management in the competent and ethical operation of the Corporation on a day-to-day basis and assures that the long- term interests of the shareholders are being served.
      ——

      the item one is that the Board, the CEO and the management would take care of the shareholders.

      so the idea that Apple shouldn’t care about the shareholders is simply wrong, in fact illegal.

      3) I know that non apple shareholders and some shareholders who hold small amounts of shares keep saying they don’t care about stock price BUT

      NOTE 70% of appl is held by BIG INVESTORS like funds.

      They are pissed off and some of them have sold, others will probably take action if the stock languishes more.

      Remember the last time stock holders were pissed off? They PUSHED ASIDE JOBS and gave more power to Sculley (Jobs later resigned).

      those who say they don’t care about aapl price …think about it: what if they got rid of Cook (like the got rid of Jobs?) , and perhaps Ive then resigns because he doesn’t want to work for a Schmidt Clone? Would you care about THAT?
      (Note that the shareholders elect the Board who hire and fire the CEO).

      Shareholders got rid of the CEOs of Rim (both the founders), Nokia, Palm, several CEOs of HPs, Yahoo etc. (that’s only counting tech firms). Most of them got chopped around the time the stock fell 50-70% , about the point aapl is now. (when the stock falls 100% changing CEOs is too late as the company is dead).

      Predators like Einhorn wouldn’t have a hearing if the stock was ok. Cook IS worried about the stock , that’s why he gave the first dividends (note that something Jobs refused l)

      If you are an apple fan and you don’t ‘care about stock price’ please care about what Big Stockholders can do,

      (Big stockholders interfering is what I’m most worried about).

      I don’t see we’ve reached a ‘get rid of Cook’ point yet as there simply doesn’t seem to be any viable replacement but agitated shareholders is worrisome.

      note to be ABSOLUTELY CLEAR, I do NOT want shareholders to be running and influencing the general management of the company i.e in product decisions etc, but I am worried that is what will happen if the stock keeps falling.

      4) SHARE PRICE is also important in KEEPING TALENT.

      all the top executives are paid mostly in shares, most of the top apple execs have lost millions of dollars in their share options (and with the stock where it is it’s doubtful the Board will make it up by paying them MORE shares).

      companies with their sharp price dead or falling find it difficult to hire the best. A few years ago if you were a young just graduated Brilliant Software Guy would you want to work for Facebook where you could possibly become a multi millionaire when they went public or Msft where the pay and stock is frozen?

      5) Jobs also NEVER just ” Cared about Products”, he also cared about sales and image. Jobs was a marketing and PR guy besides a product guy.

      right now the stock is down, the P.E is low showing that the perception or image of apple among investors is bad.
      (Its continually being attacked by the press like NYT, CNBC etc)
      I believe that jobs wouldn’t have let the image of apple be hurt so much.

      The best thing for the stock price would be for apple management to improve its P.R. and marketing.

      1. i agree, a collapse like we have seen in the last six months is a big concern when the overall market is near record hights and the company’s business isn’t breaking down (like rimm or nokia). that apple’s under tim cook doesn’t do much about it (better pr, buybacks) is more than worrisome.

    2. Stock prices have little to do with what Apple is really about. If top quality products keep coming out and selling, it will go back up. Let’s just hope that Tim Cook, et. al. do not get too hung up in pleasing investors. That will take their eye off the ball.

  6. Wow, here I thought Apple was reporting on the March quarter. Time sure flies. Oh, they are, then I guess this will keep up until WS extracts Apple’s cash into their pockets. Read my lips “You assholes are not getting a dime.”

  7. Apple shareholders can only look forward to increased dividends because that’s the only thing Apple has any control over. Unfortunately, it still hurts to see Apple sink to $350 and Google going to $850. It’s just a matter of pride and it hurts to think Google is that much better a company than Apple. All that Apple has built over the last five years is going for nought in shareholder value and that’s a bitter pill to swallow.

    It’s like Apple built a pyramid of stone and the rain is quickly washing it away like sand while Amazon and Google stand strong and tall like invincible steel structures. It’s really just amazing how the totally unexpected becomes reality and it’s just starting to sink in to my consciousness.

  8. oH God I seriously hope they report awful earnings…

    I for one can’t wait until they go private… The “market” is the worst part of Apple’s business. Half of ALL the the stupid articles written about Apple are about heir “market worth” and not their potential as a company.

    Anyone who has invested in Apple… Die a slow death.

  9. Like I said earlier. In 5 yrs, Google is up about 150%, Apple is up 230%. And Google is a great ad company. Everything they do is to sell ads, not make great hardware.

  10. Apple is not treated the same as any other company. All hairs must be in place or WS will punish. Amazon will not make 1/10 the profit in 10 yrs that Apple makes now, yet WS pays up for AMZN stock. It’s totally unfair. AAPL should have been flirting w 1000 2 yrs ago but has always been punished w a low multiple. It’s a victim of its own spectacular success.

  11. Wall Steet analysts arnt trying to work out the correct valuation of the stock. They work for brokers and hence their job is to get people to trade at today’s price. The usual way is for them to constantly adjust their price targets to 20% up from the current price, such that every day is a fantastic buying opportunity. When a stock gets over owned the only way to get brokerage business is to cut targets and expectations to get some sell order business and perhaps some stock loan business as well. Hence if you want to read analysts work, you have to take it with a “handful” of salt.

  12. At today’s pricing, AAPL should borrow another 250 billion and take the company private. OR
    Beat the estimates, pile up the cash, shock the damn analysts and buy back half the stock.

  13. Use all current profits to buy back stock (13 billion from last quarter).
    Pay dividends from US cash on hand.
    Make great stuff.
    Sell a ton.
    Buy back stock.

    Repeat.

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