Now that Google (GOOG) has blown away the Street with its March quarter results, can Apple (AAPL) do the same when it reports on Wednesday?
There is a growing belief on the Street that it just might.
This morning, Caris & Co.’s Shebly Seyrafi asserted that Apple is likely to beat expectations for the quarter, driven by strong Mac shipments and better than expected gross margins. He now sees revenue for the fiscal second quarter of $7.04 billion, up from $6.93 billion. He sees EPS of $1.12, up from $1.11, and above the consensus of $1.06. (The company previously guided to $6.8 billion and 94 cents; but Apple routinely lowballs its numbers.) He sees gross margins of 35%, above the guidance of 32%.
He is looking for shipments of 9 million iPods, 2.14 million Macs and 2 million iPhones.
For the June quarter, he sees revenue of $7.35 billion and EPS of $1.14; that’s above the Street at $7.14 billion and $1.10. Seyrafi maintains an Above Average rating and $170 price target on the stock.
Goldman Sachs analyst David Bailey this morning raised his target price on Apple to $185 from $175, asserting that strong Mac sales and a better product mix should offset sluggish iPhone and iPod sales and allow the company to report March quarter results “strong enough to satisfy the Street.” With the 3G iPhone launch an estimated two months away, he advises buying the stock here.
Bailey raised his March quarter EPS estimate to $1.09 from $1.02, and above the Street at $1.06, to reflect better gross margin from component cost declines and “a higher-end skew within each product line.” He expects gross margin at 34.7%, flat with the December quarter. The company is due to report results on Wednesday. He raised his June quarter estimate to $1.12, from $1.05, above the Street at $1.10. Bailey sees March quarter unit sales of 2.1 million Macs; he sees 1.4 million iPhones. He sees calendar 2008 sales of 11 million iPhones, ahead of the company’s much-publicized 10 million unit estimate.
Apple today is up $7.16, or 4.63%, at $161.62 (2:15 p.m. EDT).
