Shares of Apple (AAPL) are up $9.23, or 2%, at $514, as the company approaches its fiscal Q1 report this afternoon, after markets close.
People such as Greenlight Capital’s David Einhorn will be paying close attention. A study by Bespoke Investment Group made its way over the transom this afternoon. Based on the firm’s study of Apple performance between quarterly reports dating back to 2007, B.I.G. relates, “Apple has fallen 16.43% since its last earnings report, but we found that the stock�s performance in between reports has no baring on how it performs on the day of its report.”
“If anything, we found that down moves in AAPL leading up to its earnings report means it�s more likely to react positively to the report.”
It’s not too late, then, for the Street to offer some prognostications. Consensus stands at $54.98 billion in revenue and $13.48 per share in profit. Apple’s own forecast, offered October 25th, is for revenue of $52 billion and $11.75 a share, and gross margin of 36%.
For the March quarter, the Street is modeling $45.6 billion in revenue and $11.74 per share.
Bernstein Research‘s Toni Sacconaghi reiterates an Outperform rating on Apple shares today, and a $750 price target. He’s modeling $57.4 billion and a $14.50 a share, on sales of 50 million iPhones and 27.3 million iPads.
Sacconaghi thinks the Street is a bit too pessimistic about margins, writing, “Investors are concerned that lower iPhone margins may be structural, rather that cyclical (i.e., associated with the ramping of the iPhone 5).”
We expect a 120 bp sequential decline in total company gross margins to 38.8%, but are 40 bp above consensus. The primary driver of gross margins in the quarter will be the margin progression on iPhone 5, which we expect will have gross margins in the high 40s, up from the low-40% or last quarter. Display yields appear to have improved meaningfully through the quarter and Apple should have started seeing volume benefits.
Piper Jaffray‘s Gene Munster reiterates an Overweight rating on the stock and an $875 price target, writing that the report should be a “modest positive” for the shares. He’s modeling revenue of $57 billion and EPS of $13.73, on sales of 50 million iPhones at an average price of $630, and sales of 24 million iPads, including 9 million iPad mini units. He models gross margin of 39%.
Munster thinks the buy side, based on a survey of investors over the last week, is expecting Apple’s “guidance” for this quarter to be more about $41 billion and $9.40 per share, based on possible sales of 32 million to 34 million iPhones and 18 to 20 million iPads.
Writes Munster, “We believe the true catalyst for shares will be growing anticipation of new products, most notably an iPhone for emerging markets and an Apple Television.”
“We believe the issue with shares of AAPL is not valuation, rather an identifiable product catalyst, which should come into focus over the next 3-6 months.”
Brian Marshall of�ISI Group reiterates a Buy rating and a $710 price target. He’s predicting $52.3 billion in revenue and $12.75 per share in profit, based on sales of 48 million iPhones and 19 million iPads. For the current quarter, he thinks Apple could ultimately deliver $46.5 billion and $12.32 per share based on sales of 45 million iPhones and 16 million iPads.
Writes Marshall, “We look for signs that AAPL gross margins have bottomed with the iPhone 5 launch and can stabilize in the low-40% range for CY13 (e.g., Mar-13 GM guidance of ~38% would be supportive of this).”
“In addition, investors will be looking to gain visibility on the iPhone/iPad demand outlook and potential impact of competitive pressures (e.g., Samsung, etc.). Net-net, the iPhone/iPad families have plenty of runway to increase penetration internationally, the Street has become overly negative and AAPL’s ecosystem remains best-in-class.”
Abhey Lamba with�Mizuho Securities USA reiterates a Buy rating and a $600 price target, writing that “there is a slight downside risk to revenues” given that iPhone shipments may outperform while iPad units and average sales price may be lower than expected.
He’s modeling “around $53-54 billion” in revenue “and $13-13.50″ in profit per share. Gross margin will likely be in-line with consensus at 38.5% to 39%.� Apple probably sold 50 million iPhones, while “For iPads, revenues could fall short due to fewer shipments and lower ASPs.”
“The segment will experience a greater mix of iPad 2 and iPad mini but supply constraints impacted iPad minis.”
But the company will likely forecast this quarter at $39 billion and $9, well below consensus he writes:
In our view, forecasts for nearly all segments need to move lower. The company should experience a meaningful sequential drop in iPhone shipments due to a normal seasonal downtick as well as fulfillment of pent-up demand associated with the new product release in the December quarter. For iPads, while there is slight downside risk to the unit volume forecast, the segment�s ASPs should also move lower.
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