BMO: Apple Likely to Continue Low-Ball of Investor Guidance

July 14th, 2008 at 3:00 PM - Apple Stock Watch by John Martellaro

Apple has provided conservative investor guidance in seven of eight previous quarters, and BMO Capital believes that that Apple will do it again in the Earnings Report forecast for the quarter ending in September. The uncertain state of the economy, a gap in iPhone sales between May and July 11, and economic stimulus checks all play a role.

Keith Bachman, an analyst with BMO Capital reiterated that Apple typically beats its guidance, and while the company may forecast something around US$7.7B, the companyis actual growth should exceed $8B and deliver an Earnings Per Share (ESP) of $1.21. He is expecting Apple to forecast only $1.00 EPS.

Despite the current economic problems, other analysts see solid current quarter sales for Apple, growing sales in all product lines and especially strong Mac sales. Bernstein Research analyst Toni Sacconaghi is predicting 2.52 million Mac sales for the June quarter. He believes Mac and iPod sales strength has been driven by government stimulus checks.

Mr. Sacconaghi believes that investor confidence regarding the iPhone 3G will offset disappointment over the conservative guidance offered for the September quarter.

Apple will conduct its (fiscal) Q308 financial results on Monday, Jul 21, at 2:00 PM PDT. The webcast can be listened to in realtime with QuickTime. In that webcast, Apple will report on performance for the quarter ending in June and provide guidance for the quarter ending in September.