Apple Delivers Big Upside, and the Stock Has Plenty of Room to Run.
Last night, Apple reported 1QFY11 sales of $26.74 billion, above our estimate of $24.17 billion, while pro forma EPS of $6.43 handily exceeded our $5.35 projection (Street was at $5.40). Despite Monday's news regarding Steve Jobs's medical leave of absence, we believe it will be difficult to keep Apple's stock from reaching new highs given the much stronger than expected quarter and outlook reported by the company last night. With the stock now trading at just over 11x our conservative CY11 EPS estimate (ex-cash), we believe there is plenty of upside left in the stock price, and we are raising our 12-month price target to $550.00.
Here's a quick summary of other notable comments on AAPL:
- Jeffries: Strong Quarter and Guidance: We Slightly Raise our Street-High Estimates (reits $450 tgt)
- Piper: Mobile Products Take Off; Growth Rates Increase; Raising Rev Ests By 11% (tgt raised to $483)
- Morgan Stanley: CY11 Bull Case Becomes $30 EPS as Margins Beat (reits OW and $410 tgt)
- Merrill Lynch/BofA: Strong quarter on all fronts; much more to come; Buy (tgt raised to $450)
- Citigroup: GM Recovery and Balanced Growth Highlight Stellar Quarter; Reiterate Buy with New Target of $415
Notablecalls: Up, up & away? $350+ today?