Sterne Agee analyst Shaw Wu sees improving component prices as a good sign for Apple’s bottom line and ability to ship more iPads. Mr. Wu expects Apple benefit enough from improving component pricing that he raised is current quarter earnings estimate from US$5.75 a share up to $5.95, according to Forbes.
“Since we raised estimates in late May due to our checks of better iPad component availability and yields, we have picked up that overall component trends continue to improve,” Mr. Wu said.
He added that Apple has “proven in the past to be among the most adept in taking advantage of lower pricing.”
Better parts pricing and availability is good news for consumers, too, since it means Apple may be able to get ahold of more components for building iPad 2 units. The company has been hard pressed to keep up with demand ever since the new multimedia tablet was introduced earlier this year, and still shows up to a two week wait for delivery on its Web site.
Mr. Wu has a “Buy” rating for Apple’s stock, and expects the company to report $24.6 billion in revenue for the quarter. Apple is currently trading at $350.64, up 1.21 (0.35%).