While it is still early in the June quarter this is an indication that Apple should meaningfully exceed its gross margin and EPS guidance of $8.68. I am currently estimating a gross margin of 45% and EPS of $11.65.

Disclosure: I am long [[AAPL]].

Here is a synopsis of iPad lead times:

March 16: 2 to 3 weeks in 8 countries (First shipment)
(US, UK, Japan, Canada, Australia, Switzerland, Germany, France)

March 21: 1 to 2 weeks in 8 countries

March 24: 1 to 2 weeks in 3 additional countries (Italy, Spain,
Netherlands)

April 20: 5 to 7 business days in 5 countries (US, Japan, Canada,
Australia, France)
Hong Kong added with 1 to 2 week availability

April 27: France back to 1 to 2 week availability

May 2: 3 to 5 business days in 5 countries (US, Japan, Canada, Australia, Hong Kong)

A way to get a read on how the new iPad is doing is to check the percent of traffic it generates versus the iPad1 and iPad2 as measured by Chitika. On May 2 about 11% of all US iPad traffic was on the new iPad.

http://labs.chitika.com/ipad/?utm_medium=referral&utm_source=pulsenews&utm_medium=referral&utm_source=pulsenews

Through March 2012 there have been 67.1 million iPads sold and my initial estimate is that Apple could sell 16 million iPads in the June quarter. This would be a 73% year over year increase and 36% higher than the March quarter. While these are lower than the growth rates after the iPad2 was launched a year ago this quarters growth is coming off of a higher base (11.8 million in the March 2012 quarter vs. 4.7 million in the March 2011 quarter). Depending on its introduction to China (Apple could be waiting for a resolution to the Proview suit over the iPad naming rights in China), increased corporate and educational demand my estimate is probably more biased to the upside vs. downside.

Disclosure: I am long [[AAPL]].

Apple (AAPL) should continue to benefit from Nokia's (NOK) and RIMM's (RIMM) continuing problems in the smartphone market. While Nokia could make a comeback with Microsoft's new Windows Phone software the reviews of the new Nokia Lumia phone have been lackluster.

On Thursday, April 19, Nokia announced that it has incurred losses in the March quarter that were greater than expected due to competitive challenges and seasonality. http://press.nokia.com/2012/04/19/nokia-corporation-q1-2012-interim-report/

Since seasonality shouldn't be much different from one year to another I would attribute the shortfall to Apple, Samsung and low-end Asian competitors. Nokia announced that it had only sold 11.9 million smartphones in the March quarter vs. 24.2 million a year ago, a decline of 51%.

This is another indication that Apple could have had a strong iPhone quarter with my estimate being 39 million iPhones http://seekingalpha.com/article/514751-reading-samsung-s-tea-leaves-to-predict-iphone-demand vs. sell-side analysts around 30 to 31 million and I believe the buy-side at 34-35 million.

Disclosure: I am long [[AAPL]].

Additional disclosure: I have no position in Nokia (NOK) or RIMM (RIMM) and do not plan to initiate any positions within the next 72 hours.

It stayed at 1 to 2 weeks until Friday, April 20, when it improved to 5 to 7 business days in the US, Japan, Canada, Australia and France. It is still at 1 to 2 weeks in the UK, Germany, Switzerland, Italy, Spain and The Netherlands.

The iPad became available in Hong Kong on Friday, April 20, with 1-2 week availability along with South Korea and eleven other countries. On April 27 it became available in nine more countries including India. It is not available in Apple's China stores.

The improved shipment times and introduction of more countries is a good indication that there aren't any major manufacturing issues. However, after almost one and a half months of shipping Apple has not caught up with demand.

A way to get a read on how the new iPad is doing is to check the percent of traffic it generates versus the iPad1 and iPad2 as measured by Chitika. On April 28, 2012, about 11% of all US iPad traffic was on the new iPad.

http://labs.chitika.com/ipad/?utm_medium=referral&utm_source=pulsenews&utm_medium=referral&utm_source=pulsenews

Through March 2012 there have been 67.1 million iPads sold and my initial estimate is that Apple could sell 16 million iPads in the June quarter. This would be a 73% year over year increase and 36% higher than the March quarter. While these are lower than the growth rates after the iPad2 was launched a year ago this quarters growth is coming off of a higher base (11.8 million in the March 2012 quarter vs. 4.7 million in the March 2011 quarter). Depending on its introduction to China (Apple could be waiting for a resolution to the Proview suit over the iPad naming rights in China), increased corporate and educational demand my estimate is probably more biased to the upside vs. downside.

Disclosure: I am long [[AAPL]].

The important question is how Apple does in the future. As usual company guidance is very conservative. Based on my $52.50 in EPS for calendar 2012 the stock is trading at a 11.5x PE multiple and has $117 in cash per share. As a side note I had estimated March quarters EPS would be $12.25 which ranked me second out of fifty-seven analysts for EPS accuracy by Forbes magazine. Overall I was ranked third when revenue, unit sales and gross margin is included. http://tech.fortune.cnn.com/2012/04/25/apple-q2-misses-high-and-low-but-the-best-bloggers-nailed-it/

The key factors for the June quarter include

• A full quarter of iPhone 4S shipments in China
• A full quarter of the new iPad shipping
• Customers waiting for an iPhone 5 (all indications are for September/October but could surprise in June or July)
• A refresh of the Mac product line. Macs have gotten long in the tooth so are due to be updated sometime in the next few months.

For the June quarter I am currently estimating

• Revenue of $40 billion (an increase of 40% year over year) vs. guidance of $34 billion
• EPS of $11.65 (an increase of 49%) vs. guidance of $8.68

While the stock is up 49% for the year, competition will increase, growth rates will come down to more "normal" rates to the teens next year and other risks could appear (such as an iTV could disappoint when it is announced) I believe the stock will move higher. This is based on:

• A PE multiple of 12x that is very low since Apple has much higher growth rates, especially when compared to other companies metrics
• New products, especially the iPhone 5, should have a larger screen and 4G LTE capability which would sustain and probably increase its momentum in the market
• The iPhone 5 could then be sold by China Mobile, the largest wireless service provider in the world
• China could double its revenue over by 2013 and surpass the US
  • Expect more Apple stores to open in China
• Cash of $117 per share (20% of market cap) that should grow to $150 by the end of this year and about $200 by the end of 2013
• A dividend that will be paid later this year is allowing more funds to buy the shares

I believe the shares can get to $785 or possibly higher over the next year. This is calculated by either

• A 15x PE multiple on calendar 2012 EPS of $52.50
• Use a 13x PE multiple on the $52.50 in EPS and add $100 (of the $150 in cash per share at the end of the year)

Disclosure: I am long [[AAPL]].

My product projections are:

• iPhone units at 39 million based on my article "Reading Samsung's Tea Leaves To Predict iPhone Demand http://seekingalpha.com/article/514751-reading-samsung-s-tea-leaves-to-predict-iphone-demand
• iPad units of 13.5 million
• Mac units of 4.3 million
• iPod units of 7 million

My revenue, gross margin and earnings projections are:

• Revenue of $41 billion
• Gross margin of 45.5%
• EPS of $12.25

These are significantly higher than the Street's revenue projection of $36.6 billion and EPS of $10 http://finance.yahoo.com/q/ae?s=AAPL+Analyst+Estimates and guidance of $32.5 billion and $8.50. I believe the buy-side analysts are looking for about $38 billion in revenue and $10.50 to $11 in earnings.

It is worth noting that in the past two years Apple's revenue has decreased by 14% and 8% from the December quarter to March quarter, respectively, while EPS has decreased by 9% and 1% respectively. My projections are for a 12% revenue decline and 12% EPS decline but again the December quarter having 14 weeks could make for an apples to oranges comparison.

I believe the Street will have to increase its full year fiscal earnings projections after the March quarter is announced. Currently the Street is expecting about $44.37 in EPS for fiscal 2012. Since the company should generate $25 in EPS in its fiscal first half the second half earnings would about $20, a major decline which I don't think will occur as I believe Apple can earn $50 this year.

At Friday's closing price of $573 the stock would be trading at 11.5x my $50 EPS estimate and that does not take into account the approximately $115 in cash and investments per share the company should have as of the end of March.

Disclosure: I am long [[AAPL]].