Monday, April 21, 2008

Apple (NASDAQ:AAPL): Citigroup ups EPS est to a new Street high

Citigroup is raising their ests on Apple (NASDAQ:AAPL) to a new Street high. Firm now expects $7.0B rev(prev $6.9B, consensus $6.95B), 36.5% GM (35.2%, ~33.5%), and EPS of $1.23 ( prev $1.14, consensus $1.06). New 1CQ08 rev and EPS ests reflect solid PC sales and, more importantly, sharp ~40% declines in DRAM/flash pricing.

Citi now expects PC unit shipments of 2.1M (+38% yoy) versus our prior estimate of 2.0M and consensus of 2.06M, with upside coming from Mac Pro desktops and MacBook Air notebooks. They now expect iPod unit shipments of 9.5M versus prior estimate of 10.0M and consensus of 10.5M; iPod should struggle until the line is refreshed in 3CQ.

They continue to expect iPhone unit shipments of 1.5M despite the impending 3G iPhone launch.
Citi expects Apple to guide 2CQ revenue flattish sequentially, gross margin down sequentially, and EPS down sequentially, none of which should shock the Street.

Reits Buy and $212 tgt. AAPL remains their Top Pick.

Notablecalls: Note that Citi's $1.23 EPS est is the new Street high. That's a pretty bold move by Mr. Gardner. Should drive at least $2-3 pts of upside in the stock early on.

4 comments:

John S. said...

I've missed your Barron's Sunday Recap over the last month. . Any reason why you stopped posting that? I'm sure you are a busy guy.

Just curious.

Love your blog.

Thanks

anjinho said...

It's a trick so that they can say Apple didn't hit THEIR estimates thus disapointed. How incompetent and manipulative...

The HardHead Fund said...

Darn, I hate most Anals - Apple should be ~$220 if these knuckleheads did their homework back in Jan. No one remembers the ASP of %188 per iTouch and the $49 Shuffle. The PUMP continues to $300 EOY! Beware of the sandbag guidance again - wished they would do same a Google and just let the market take care of itself.

HH

The HardHead Fund said...

Citi Quick Call — Apple remains our top hardware pick through calendar year-end, with a new $248 12-month target.

APPLE is AWESOME - June REV est $7.2 Million meeting the street and huhu $1 EPS (add the typical 20% sandbag) and $1.20 for June... beating the Street by 10 cents.

HH