Apple Inc. (NASDAQ:AAPL) fans appear to have been “modestly disappointed” in the company’s iPhone launch, according to surveys conducted by analysts at BMO Capital Markets. They’re also concerned about the range of revenue guidance provided by the company for the December quarter compared to consensus estimates. Nonetheless, they are retaining their Outperform rating on the company and increasing their price target from $480 per share to $508 per share.

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Apple survey conducted in three countries

Analysts Keith Bachman, Jung Pak and Gaurav Gupta issued a report concerning their findings from surveys conducted in the U.S., the U.K. and Germany. They said approximately 300 people were surveyed in each country, and they found that participants had “modestly lower enthusiasm” for Apple Inc. (NASDAQ:AAPL) in the wake of the recent iPhone launch.

They note that most participants who were thinking about buying a new iPhone strongly preferred the flagship iPhone 5S to the 5C. Of those surveyed, 66 percent of them preferred the 5S, while 18 percent preferred the 5C and 16 percent actually said they preferred the iPhone 4S.

iPhone unit estimates lowered, EPS raised

The analysts said they lowered their unit estimates for the iPhone but raised their average selling price for the iPhone. They’re now assuming 10 percent unit growth for the iPhone in the fiscal 2014 year and 3 percent the following year. That’s compared to their previous forecasts of 13 percent for 2014 and 11 percent in 2015. They believe demand is still trending weaker and have added an iPhone with a bigger screen to their forecast starting in the middle of the 2014 calendar year.

They raised their earnings per share estimate for the 2014 fiscal year from $40.25 to $42.11 per share. Consensus is $42.95 per share. They lowered their earnings per share estimate for 2015 from $44.14 per share to $43.51 per share.

Will Apple keep its current market share?

One interesting finding the analysts found was that the number of people who said they would buy the iPhone or iPad in the U.S. is lower than Apple Inc. (NASDAQ:AAPL)’s current market share. However, they did also see a larger number of people who said they didn’t now.

Purchase intent for both devices was above the company’s current market share in Germany and the U.K.

The Apple story is changing

The BMO Capital analysts said they believe Apple Inc. (NASDAQ:AAPL) has transformed from a company whose stock has the potential for unit or revenue upside on gradually declining margins, based on mid-priced iPhones, to a company with limited to modest revenue growth. They suggest that upside to consensus is very unlikely. They said they see the company also having steady margins with some potential of upside with “aggressive capital allocation.”

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