Tuesday, November 28, 2006

Calls of Note Part 1

- UBS is positive on Apple (NASDAQ:AAPL) saying their checks point toward solid iPod sales for new shuffles & certain nanos along with momentum in Macs and prospects for higher accessories & software longer-term. Firm continues to believe AAPL will launch new products in calendar '07 (not fully reflected in their model) including cell phones, iTV & even ultraportable devices.

Given their findings, the firm is raising their 1Q07 EPS estimate to $0.80 (was $0.78) based on 11% revenue growth (+32% q/q) to $6.4B (was $6.3B) & operating margin of 14.2% factoring in higher iPod unit growth of 18% to 16.56mm (was 15.6mm) and still reflecting Mac unit growth of 44% to 1.8mm.

Given prospects for new iPods and with Mac sales momentum drivng software & peripherals, they are raising their FY07 EPS estimate to $2.84 (was $2.75) based on 23% revenue growth to $23.76B (was $23.25B). For FY08, estimate adjusts to $3.35 from $3.15 based on 18% revenue growth to $28B (was $26.7B).

Reits Buy and ups tgt to $108 from $95.

Notablecalls: This is the second tgt raise above the $100 level. Is it actionable? Most certainly not.

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