Thursday, July 12, 2007

Apple (NASDAQ:AAPL): iPhone checks show upside to current ests!

- RBC Capital notes their checks suggest Apple (NASDAQ:AAPL) may plan to produce 8M iPhones CY07, implying 12-14M unit sales end CY08, well ahead of Apple's publicly stated 18-mo 10M goal. Apple's CY07 plans may include offering higher memory (e.g. 16GB) iPhones, while refreshing existing models at lower cost to stimulate demand. Plans appear to include inventory for Canadian, European launches (est. Q4/CY07"Q2/CY08) and Asia (est. mid CY08). Firm sees a 3G/HSDPA iPhone by Spring CY08, and believes Apple is also planning a higher- resolution display (480x720).

Checks also suggest Apple may be planning an iPod line refresh Q4CY07, including new versions that they believe include: an updated iPod Nano, a new iPod and new video iPod. Some or all may include iPhone-like features (Touchscreen, Widescreen, new UI etc). RBC also expects new devices with more memory and integrated wireless (Wi-Fi).

Based on these checks, the firm is raising their iPhone sales outlook to 13.5M units (10.1M prior) end CY08. They continue to expect iPhone momentum to ease following early sales, reinvigorated subsequently on new launches. F08 estimates adjust to $32.2B revenue ($31.2B prior) and $4.52 EPS ($4.38 prior).

Reits Outperform and $160 tgt.

Notabelcalls: Is this enough to push AAPL to a new 52 wk high? Sure, why not. iPhone flow looks like the only thing that moves AAPL. I think.