Apple Inc. PT, Estimates Raised By Goldman Sachs


Apple Inc. (NASDAQ:AAPL) shares have surged more than 12% since April 23, when the company reported its second quarter results. The tech giant’s Q2 results were much better than expected. That wasn’t all, Apple Inc. (NASDAQ:AAPL) surprised the markets with 8% dividend hike, 7-to-1 stock split, and a $30 billion share buyback program. On April 29, the iPhone maker issued $12 billion of bonds in a 7-part offering. The bond offering includes five fixed-rate notes worth $10 billion and two floating-rate notes worth $2 billion.

Apple to spend the proceeds on buybacks, dividends

Apple Inc. (NASDAQ:AAPL) said it will use the proceeds for general corporate purposes including dividend payments and share buybacks. Yesterday, Apple also updated two new MacBook Air products with Intel Corporation (NASDAQ:INTC)’s Haswell processors. The new MacBook Airs have a lower price. Goldman Sachs analysts Bill Shope, Cristina Colon and Justin Price said in a research note that they have updated their estimates to reflect growth in funds, more share buyback, and new products. Goldman Sachs has increased its price target from $620 to $635, and the firm maintains its Buy rating on the stock.

The research firm said it now expects Apple Inc. (NASDAQ:AAPL) to buyback $39 billion of its stock in FY2014 (up from the previous estimate of $34 billion). The analysts assume that the company would repurchase $26.05 billion of stock in FY2015 and $8 billion in FY2016. Bill Shope said that the iPhone maker would distribute a cumulative total of about $130 billion to shareholders by the end of 2015. That includes $38.3 billion in dividends and $90 billion in share buybacks.

Goldman raises its revenue and EPS estimate for Apple

Goldman Sachs forecasts $182.5 billion in revenues and $44.75 in EPS for Apple Inc. (NASDAQ:AAPL) in the current fiscal year. Sales are expected to jump to $205.08 billion in FY2015 and $230.84 billion in FY2016. Meanwhile, EPS is expected to go up to $53.64 in FY2015 and $62.66 in FY2016.

Apple Inc. (NASDAQ:AAPL) shares inched up 0.88% to $597.55 at 10:40 AM EDT on Wednesday. The stock has gained about 35% over the past 12 months.

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About the Author

Vikas Shukla
Vikas Shukla has a strong interest in business, finance, and technology. He writes regularly on these topics. - He can be contacted by email at or on Twitter @VikShukla10

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