Apple Inc. (AAPL) iPhone 5 Concern Appears Overdone: Pacific Crest

Apple Inc. (AAPL) iPhone 5 Concern Appears Overdone: Pacific Crest
JESHOOTS / Pixabay

Apple Inc. (AAPL) iPhone 5 Concern Appears Overdone: Pacific Crest

Apple Inc. (NASDAQ:AAPL) has received a positive report from Pacific Crest Securities following continued scepticism from media and some analysts, over its ability to meet the consensus estimate iPhone sales of over 50 million for FQ1. The  firm believes that the supply constraints on iPhone 5 have eased, and the company should be able to meet its 51 million sales units estimated for the December quarter.

Pacific Crest analysts don’t have the same faith in the iPad mini, as it has emerged that there may be production constraints related to quality, which are likely to push a large percentage of production into November and December. Pacific Crest perceives a solid demand for the company’s iPhone devices.

Seth Klarman Describes His Approach In Rare Harvard Interview

Seth KlarmanIn a rare interview with Harvard Business School that was published online earlier this month, (it has since been taken down) value investor Seth Klarman spoke at length about his investment process, philosophy and the changes value investors have had to overcome during the past decade. Klarman’s hedge fund, the Boston-based Baupost has one of Read More

Additionally, the company’s reduced price on iPhone 4s to $99, and iPhone 4 to $0 per unit is likely to continue attracting demand from the mid level class of customers, especially, in the emerging markets.

Apple Inc. (NASDAQ:AAPL) is expected to report at least 40 million sales units for the new iPhone 5 during the December quarter, while the earlier versions, iPhone 4S, and iPhone 4 should ship at least 10 million units, with an overall estimated figure of 52 million units.

Apple Inc. (NASDAQ:AAPL)’s FQ2 is, however, expected to report a slight decline in sales from the iPhone devices unit, with FQ3 experiencing a huge decline, which replicates the 2012 trend.

Nonetheless, the company is expected to grow its overall revenues for the next fiscal year from $46.33 billion to $59.73 billion. With this forecast in mind, the analysts from Pacific Crest Securities believe that the current market price of Apple Inc. (NASDAQ:AAPL) does not reflect the correct earnings power of the iPhone and iPad maker, and have maintained their price target of $760 on the stock.

Additionally, the analysts have forecast the company’s earnings per share to hit $18.47 earnings per share for 2013, or 33% growth.

Apple Inc. (AAPL) iPhone 5 Concern Appears Overdone: Pacific Crest

Apple Inc. (NASDAQ:AAPL)’s iPad sales units for the last fiscal year fell short of the 45 million mark; however, the company is set to achieve this level within the first two quarters of the current year, with F1Q13 sales units estimated to be more than, 25 million, while the second quarter is expected to notch at least 20 million units. Notwithstanding, the analysts foresee a risk inherent in iPad mini production, which threatens their 10 sales units estimate for the current quarter as earlier noted.

Nonetheless, the analysts are of the opinion that the iPad supply units appear consistent with their estimates, despite the production concern, and are comfortable with their 25.5 million estimate.

The New iPad, plus the iPad 2, are expected to ship a combined total of at least 15 million units in FQ1, and 12.5 million units in FQ2, while FQ3, and FQ4 for year 2013 should rise gradually. In total, iPad sales units are expected to grow by at least 100% for year 2013, as compared to 2012 figure.

Overall, Apple Inc. (NASDAQ:AAPL) is expected to ship approximately, 175 million units of iPhones for the current fiscal year, as compared to about 126 million units shipped over the last fiscal year, or nearly 50% growth.

Updated on

Sheeraz is our COO (Chief - Operations), his primary duty is curating and editing of ValueWalk. He is main reason behind the rapid growth of the business. Sheeraz previously ran a taxation firm. He is an expert in technology, he has over 5.5 years of design, development and roll-out experience for SEO and SEM. - Email: sraza(at)
Previous article Citigroup Beats Estimates, Takes $4.7B Write Down on MSSB
Next article Zynga Sues Former Employee For Stealing Trade Secrets

No posts to display