RBC Hikes Apple Target Ahead of Q4 Report Monday

| About: Apple Inc. (AAPL)

Apple Inc. (NASDAQ:AAPL) is reaching an inflection point in PC market share as it should see more momentum from Mac sales in the next two quarters, according to RBC Capital Markets’ Mike Abramsky. As a result, the analyst hiked his price target on the shares to US$205 from US$175.

RBC expects Apple will report fourth quarter revenue of US$6.4-billion, which compares to the Street at US$6-billion and Apple’s guidance of US$5.7-billion. The firm is also forecasting Mac shipments will come in at 2.2 million, portables at 1.5 million and desktops at 686,000.

As for the iPhone, RBC expects to hear that 1 million devices were sold in the fourth quarter, while checks suggest the percentage of units shipped which are actually sold remains up 25% to 30% since Apple cut prices for the smart phone.

As for guidance for the first quarter of 2008, RBC expects revenue will be between US$8-billion to US$8.5-billion.

“The huge Q4 momentum, and Apple’s typically conservative guidance, is likely to offset investor concerns regarding guidance, given the pending strong holiday season,” Mr. Abramsky wrote.

Apple is expected to report on Monday.

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