Citigroup Bumps Up AAPL Earnings Estimate

by , 8:40 AM EDT, April 21st, 2008

Citigroup analyst Richard Gardner is expecting Apple will report even better than expected earnings during its quarterly investor conference call this Wednesday and is raising his estimates accordingly. He now expects Apple will report US$7 billion in quarterly earnings, above the Street consensus of $6.95 billion, according to Notable Calls.

Mr. Gardner is predicting Apple will report Mac shipments at 2.1 million units, up 38 percent year over year, and that those numbers will be driven by Mac Pro and MacBook Air sales.

iPod shipment estimates, however, are down at 9.5 million units from analyst earlier estimates of 10 million. Citigroup's iPod estimates come in well below the 10.5 million industry consensus. According to Mr. Gardner, iPod sales will likely remain flat until Apple refreshes the product line -- a move he expects will come in Apple's third quarter.

iPhone sales will likely come in at 1.5 million units despite the rumors that a 3G model is due within weeks.

Mr. Gardner estimates that Apple will report $7 billion in revenue with an EPS at $1.23, up from his earlier estimate of $1.14 and well above the $1.06 consensus. He is maintaining his "Buy" rating and $212 target price for Apple stock.

Apple is currently trading at $162, up 0.96 (0.60%).

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