The Mac Observer

Skip navigational links

You're viewing an article in TMO's historic archive vault. Here, we've preserved the comments and how the site looked along with the article. Use this link to view the article on our current site:
PJC: A Guide to Apple's Guidance

PJC: A Guide to Apple's Guidance

by , 4:10 PM EDT, October 20th, 2008

Apple is set to report its FY Q4 earnings on Tuesday. In the past, Apple has typically guided conservatively for the next quarter, hoping to beat the Street's estimates. This time, however, the task may be trickier given the state of the economy, and so Piper Jaffray's Gene Munster has provided some historical charts to assist with the assessment of Apple guidance for FY09 Q1.

Mr. Munster went back eight quarters and noted that during that time, Apple has guided on its earnings per share (EPS) about 9 percent below the expectations of the Street and 4 percent below on revenue. Then, when the actual earnings are reported, Apple blows away the EPS estimate by 27 percent and the revenue by 4 percent.


Source: Piper Jaffray

This time around, Mr. Munster predicts that Apple's guidance will be more conservative than usual. The problem is that if Apple guides too low, its stock will take a hit in the near term by investors who continue to be nervous about the economy. If Apple guides too high and doesn't meet expectations, the stock will take a similar hit in January.

Further complicating Apple's task is the fact that most of Apple's phenomenal Mac sales have occurred in July, August and early September, before the recent banking crisis surfaced. So no matter what Apple reports in terms of Mac sales, investors could be skeptical if Apple can maintain the pace. All eyes will be on Apple to see how they address that issue on Tuesday.

Mr. Munster expects Apple to report 2.8 million Macs sold, 11 million iPods, 5 million iPhones, revenue of US$11.42B and and EPS of $1.76. Despite everything that has happened with the stock market as a whole lately, he is holding to his target of $250 per share.

In afternoon trading, AAPL was at US$97.75, up $0.18 for the day.


If you are interested in Apple's stock, join our forum members in the Apple Finance Boards, a moderated forum for Apple Investors and people who are interested in Apple's financial dealings. For other stories regarding Apple's stock activity, visit our updated Apple Stock Watch Special Report.

Recent Headlines - Updated February 28th

Fri,8:54 PM
Apple Death Knell #68: Apple’s Stock Will Collapse Because iPhone Is Too Important
7:32 PM
Last Chance: Pay What You Want for the Learn to Design Bundle
4:30 PM
What to Expect During Apple’s March 9 Media Event
1:09 PM
TMO Daily Observations 2015-02-27: Apple Watch Media Event Smackdown
11:20 AM
Ericsson Sues Apple after Failing to Reach Patent License Agreement
10:01 AM
Analyst: Apple Watch Edition to Cost $950
8:55 AM
QuickTime & Yosemite: Recording Your iPhone or iPad Screen with iOS 8
Thu,8:36 PM
Apple Opens iWork for iCloud to Everyone
7:53 PM
This Is Why You Should Set Up Philips Hue LED Smartbulbs
7:15 PM
Apple Rumored to Bring Touch ID to Macs
4:40 PM
Last Chance To Save 55% On The Code Black HD Camera Drone
3:54 PM
FCC Reclassifies Internet Providers in Net Neutrality Vote
  • __________
  • Buy Stuff, Support TMO!
  • Podcast: Mac Geek Gab
  • Podcast: Apple Weekly Report
  • TMO on Twitter!