Apple’s Guidance: What's Missing?

It is a shame that the market chooses to ignore Apple's (AAPL) mango earnings and revenue, and only move the stock based on BS guidance. Let's look at some facts.

The native version of MS Office for Apple creates a whole new set of converts for the sleek elegance of the Mac. Ads are already running in traditional Apple territory such as the Daily Show.

True, many businesses will not go out and purchase a whole new slew of Macs tossing their PCs. However, professionals who bring their work home, small business owners and business students can overcome one of the few last objections and jump on the Mac bandwagon.

The ubiquitous iPod is now available in more sizes and colors than Magnolia cup cakes, and the iPhone is now tracking with estimates. Both of these devices bring soft sales of downloads and revenue shares of phone service. These sources of reoccurring revenue are crucial to understanding the firm’s growth. It is the razor and blade game done to perfection.

Last are sales outside the U.S. which are growing nicely. Plus, go to any Apple store on the east coast, the language spoken is not geek and certainly not English. It is the tongues spoken by the people who have made the U.S. their shopping destination of choice. That is defined as anyone whose native currency is Euros.

Add it up - under promise and over deliver. How many quarters will it take for the Street to catch on to the game?

Disclosure: Mr. Corn is long Apple (AAPL) and Microsoft (MSFT).

Comments

[ramankandola]

two upgrade today from CITI and Bank of America.

$180-$248

Citi raised target from $212 to $2.48
24 April 2008, Apple Inc (AAPL), Citi raises target.

From linda57... on this message board, thanks linda57..

Unit Shipment Upside in ALL Product Categories;

Reiterate Buy

Call — Apple remains our top hardware pick through calendar year-end, with a new $248 12-month target, following a 7-8% revenue beat (Google also beat by 7-8%) with upside from all product lines in 1CQ08. A steady stream of new product announcements between June and September should allow the company to continue to gain significant market share in PCs and handsets during 2HCY08. Component Tailwind in 2CQ — We had expected higher gross margin in 1CQ and now believe that Apple entered the quarter with a significant amount of memory inventory procured at higher prices during 4CQ. However, as Apple procures memory in 2CQ at prevailing contract prices, the company should benefit from the component cost tailwind that we had expected last quarter.

9 June is D-Day for 3G — The first of an impressive wave of new products will be a new 3G iPhone and the iPhone Software Development Kit (SDK). During
the subsequent three months, we expect a complete refresh of the laptop and iPod lines. The SDK should yield hundreds of compelling iPhone/iPod touch
third-party apps for by Christmas. Little Change to Above-Consensus FY09/10 Ests — An increase in revenue
estimates for all future periods is mostly offset by more-conservative assumptions on monthly residuals from cell phone carrier partners. We have reduced carrier residuals in anticipation of more traditional carrier relationships with forthcoming carrier partners around the world.

[ramankandola]

LEH just raised the target again.

Apple Inc Summary of Price Target Changes for Apple - Price target raised to $180 from $170 at Bank of America. - Price target raised to $202 from $195 at Lehman Brothers; maintains "Overweight" rating

[wallawallabingbang]

The cult of the Analyst has to come to an end.

These guys do not facilitate the flow of capital in the marketplace, they disrupt it and cause unwarrented perturbations in stock valuations.

Look at AmTech's Shaw Wu and what happened when he egregiously threw a wet blanket on earnings expectations prior to the CC. An uncalled for and precipitous drop.

Manipulation? Possibly.

We should learn be swayed less by these charlatans and realize that no one can divine the future.

It's also time to grow up and stop punishing the messenger if the 'guidance' doesn't tickle our fancy.

Personally, I feel Apple should pull a 'google' and stop gudance altogether.

It's a fool's game.

[Rob L]

wallawallabingban........