Analyst: Apple to Beat Q4 Guidance

by , 11:30 AM EDT, October 19th, 2007

American Technology Research analyst Shaw Wu anticipates Apple will report strong earnings during its fourth quarter conference call on Monday, and that the company will likely beat its own guidance by a significant margin.

Mr. Wu commented "We anticipate Apple will beat its guidance substantially driven by broad strength across product lines and an unseasonably favorable mix towards the high-end (students don't usually load up on $1800 to $2000 Macs, $250 to $400 iPods, and $400 iPhones)."

He also expects the Mac and iPod maker's revenue will come close to hitting the $6.05 billion mark with an ESP just above $0.85. Those numbers come in well above Apple's $5.7 billion and $0.65 EPS guidance.

Looking forward, Mr. Wu assumed that Apple will offer its traditional conservative guidance for the December quarter to help keep unrealistic investor expectations under control. His expectation is that Apple will show $8.1 billion in revenue and $1.25 EPS for December the quarter, below the Street consensus of $8.6 billion and $1.38 EPS.

Mr. Wu is maintaining his "Buy" rating and $185 target price for Apple's stock. Apple is currently trading at $173.30, down .20 (.012%).

Apple's fourth quarter earnings report is scheduled for Monday, October 22 at 5PM eastern time. Be sure to check in with TMO for our real-time coverage.

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