Apple Upgrade on 'Mac Surge'

J.P. Morgan analyst Mark Moskowitz Friday morning repeated his Overweight rating on Apple (AAPL), raising his estimates and price target on the stock.

Moskowitz boosted his price target to $167.50 from $150. The stock closed Thursday at $147.52.

For the June quarter, he now sees revenue of $8.497 billion and EPS of $1.23, up from $8.114 billion and $1.12 previously. Consensus is $8.214 billion and $1.16. For the September 2009 fiscal year, he goes to $5.68 from $5.51. For FY 2010, he now sees $6.50, up from $6.20.

“The earnings revisions are top-line driven, as gross margins could lack major upward mobility due to less favorable component pricing,” he writes. “Inputs from primary research contacts indicate a Mac surge in the second half of the June quarter. While partially explained by the early June MacBook refresh, we believe sturdier demand also helped.”

He now sees Q2 Mac unit sales of 2.5 million, up from 2.13 million. He also lifted his iPhone forecast for the quarter to 4.34 million, from 3.88 million. He is less bullish on iPod demand; he is optimistic on demand for the Touch, but thinks volumes for traditional iPod models could disappoint.

AAPL Friday is up $2.17, or 1.5%, to $149.69.

Original post

Comments

[Roger Knights:]

"While partially explained by the early June MacBook refresh, we believe sturdier demand also helped.”

And considerably lower prices. Too bad they weren't lowered years ago, when picking up switchers from the beleaguered Windows franchise would have been easier.

Jul 17 12:24 PM

[Relic37:]

"Too bad they weren't lowered years ago, when picking up switchers from the beleaguered Windows franchise would have been easier."

From my perspective, Windows hasn't gotten any better - in any way, shape, or form over the years. As my desktop computers at home come up for replacement, they will be swapped for iMacs. I already use a MacBook at work, and lots of my workmates are migrating to Apple. I'm 55, hardly the swinging, hip, MacBook customer. But continued security and "crash" issues with Windows, and poor customer service from Dell have made the decision to switch quite easy.

Jul 17 01:21 PM

[Techtrader10:]

Relic37 brings up some interesting points. Preceived security, crashing software and customer service. Apple has 7.4 percent of the personal computer market, just ahead of Toshiba with 6.8 percent. Obviously with a small number of potential targets with the Apple operating system, a hacker or malicious virus programer is going to go for the largest number of operating systems you can, therefore Windows is a larger target. Crashing software is another matter. Vista was tedious to deal when it first came out with its continuous checks and sometime down right irritating questions. Sometimes, as a busy person we get too many programs running and some of them are not compatible. So, I don't know that you can blame it all on the operating system or the computer, as much as the operator over reaching the capacity of the machine. Now poor customer service, is the thing that I can not stand. Good customer service is your assurance of next purchase of your product. Without that part of the business, you can kiss the next sale goodbye. I have never owned an Apple computer, as my business always required me to be compatible with other operating systems and when I started my business in the mid-80's it was difficult to find software applications that would run on an Apple computer. So I have by default been a PC owner/user. I had problems with customer service when I called Compaq a month or so ago. The customer service guy was irritating and never did help, I came away from the experience with a bad attitude toward Compaq, I felt they had let me down. I probably won't switch to an Apple product, one again the need for compatibility and software issue, but I would definitely look at someone else besides Compaq after my recent experience.

Jul 17 03:26 PM

[F. J. Taylor:]

If Techtrader 10 had ever owned an Apple, he would understand why Apple users are also enthusiasts. For his info, since the Mac now runs Windows as well as OS X (and it loads faster and runs better than on a Dell, Acer, Compaq, or HP - I have tested it against them), he should seriously consider one for his replacement - if he buys another Windows box, he will only continue to get Windows problems. He can run whatever proprietary Windows programs he wants, and still have the best OS for his E, Net, and other functions. On top of that, he can start enjoying computing, with the best OS, programs, and support in the industry.

(And just BTW, I have made a killing on Apple stock, buying low, selling off half wehen it was near its peak, and holding the rest - I am playing on "house money" now, and am long on Apple.)

Jul 18 12:39 AM

[Jon T:]

Well said Techtrader10...

Apple put the joy back into computing while Microsoft has been on a mission to make it as miserable as possible. Dell et al too with their plastic garbage boxes.

I have had 10 years of pure pleasure since I switched to Apple Macs.

Jul 18 08:04 AM

[entmd:]

I love Apple's customer service. My iMac hard drive died a month ago and when it came time to restore from my Time Capsule backup, the phone tech support knew exactly what to do and my iMac was back to it's pre crash state. My wife is in the middle of a month traveling in California and told me that the 2 year old MacBook crashed. She took it to an Apple Genius Bar and he diagnosed a fried hard drive. Although it was out of warranty, they replaced the hard drive, loaded all the software, and replaced the key pads because they've taken a beating from our 3 kids who use it. And people wonder why we love Macs and Apple. They go out of their way to make their customers happy and they make awesome products.

Jul 18 08:49 AM

[entmd:]

Oh, I forgot to mention that the Apple Store did all that for FREE.


On Jul 18 08:49 AM entmd wrote:

> I love Apple's customer service. My iMac hard drive died a month
> ago and when it came time to restore from my Time Capsule backup,
> the phone tech support knew exactly what to do and my iMac was back
> to it's pre crash state. My wife is in the middle of a month traveling
> in California and told me that the 2 year old MacBook crashed. She
> took it to an Apple Genius Bar and he diagnosed a fried hard drive.
> Although it was out of warranty, they replaced the hard drive, loaded
> all the software, and replaced the key pads because they've taken
> a beating from our 3 kids who use it. And people wonder why we love
> Macs and Apple. They go out of their way to make their customers
> happy and they make awesome products.

Jul 18 08:50 AM

[Techtrader10:]

Poor JW, can't keep it together. Looser!


On Jul 18 02:19 AM JW.PhD wrote:

> People, please don't feed the troll (Techtrader10).
>
> Thank you.

Jul 18 02:25 PM