Deagol's Q1 2008 Spreadsheet + Estimates

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    Posted: 26 October 2007 06:29 PM

    Amazing guidance

    Excluding one-time items (tax benefits once again) they came in at 93 cents, one cent below my number. Gotta love the guidance though. Looks like another iPod Christmas coming up.

    My target obliges me to be cautious here. It’s not that the stock won’t be higher at some point over the next 12 months. I’m just worried about the extent of any correction. I’m not selling any shares yet.

    3m ending on Dec-2007:
    Apple gd: $9.2 b rev, $1.42 EPS
    Analysts: $9.31b rev, $1.53 EPS
    My estmt: $9.67b rev, $1.74 EPS
    26M iPods, 2.23M Macs

    12m ending on Sep-2008:
    My estmt: $32.80b rev, $5.41 EPS
    Analysts: $31.54b rev, $4.97 EPS

    Valuation (25 ? fwd EPS):
    Dec-2007 (fair value): $146, -21% dnside (Dec-2008 EPS $5.79)
    Sep-2008 (12m target): $181, - 2% dnside (Sep-2009 EPS $7.23)
    Analysts mean target : $210, +13% upside


     

         
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    Posted: 26 October 2007 11:22 PM #1

    Re: Deagol’s Q1 2007 Spreadsheet + Estimates

    [quote author=“deagol”] ... My target obliges me to be cautious here. It’s not that the stock won’t be higher at some point over the next 12 months. I’m just worried about the extent of any correction ...

    How do you reconcile your caution with AFB’s uber bullishness?

    Fair value of $146 :evil: vs AFB’s over $200 :bugeyed: target.

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    Posted: 26 October 2007 11:52 PM #2

    Re: Deagol’s Q1 2007 Spreadsheet + Estimates

    [quote author=“Mace”]How do you reconcile your caution with AFB’s uber bullishness?

    Fair value of $146 :evil: vs AFB’s over $200 :bugeyed: target.

    err… I don’t? btw my target is $181.

         
  • Posted: 27 October 2007 12:46 AM #3

    Re: Deagol’s Q1 2007 Spreadsheet + Estimates

    [quote author=“deagol”][quote author=“Mace”]How do you reconcile your caution with AFB’s uber bullishness?

    Fair value of $146 :evil: vs AFB’s over $200 :bugeyed: target.

    err… I don’t? btw my target is $181.

    Mac sales should be higher that 2.23 mill. Deferred revenue from iPhone in this quarter will count in Q1, and iPod margins and revenue per iPod are higher in Q1.
    I see EPS closer to $2, which already puts the stock above $200 under old P/E. If you count P/E expansion then high $200s are justified.

         
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    Posted: 27 October 2007 12:58 PM #4

    Re: Deagol’s Q1 2007 Spreadsheet + Estimates

    Hi enature, nice to talk to you after all this time. Good to know you’re still bullish. We’re almost there for your target of “$300 in a couple of years.” smile

    I’ll try to add $1 billion in revenue from your suggestions, which is what is required to get to an EPS of 2 bucks.
    [quote author=“enature”]
    Mac sales should be higher that 2.23 mill.

    Possibly, but it’s arguable. According to the CC, Mac sales might not reach last quarter’s level. 2.23 million sounds about right to me, but I’ll consider 2.4 as the upper limit of what’s possible. 170k extra macs add about $250 million in revenue.
    [quote author=“enature”] Deferred revenue from iPhone in this quarter will count in Q1

    You mean approximately 1/8 of the deferred revenue, right? sorry if I’m missing your point. I have 333 million for iPhone revenue, but even if I double the sales to 5 million units, the iPhone revenue for this quarter doesn’t go over 500 million. I can’t sensibly justify adding more than $150 million revenue from iPhone sales upside.
    [quote author=“enature”]... and iPod margins and revenue per iPod are higher in Q1.

    According to the CC, more iPods in the product mix are one of the reasons for their guiding margins slightly lower. I’ll consider a higher unit price… let’s see, last quarter was $159/unit, and last year’s Q1 was $163/unit. I don’t see AUP’s going up y/y, so $163 is 3 bucks higher than my current estimate, times 26 million units adds less than $80 million to revenue.

    So, here’s as high as I could get it (million dollars):
    +250 (Mac)
    +150 (iPhone)
    + 80 (iPod)
    ——
    +480 ...we didn’t get half way there. Do you have any other rocks to look under (preferably bigger ones raspberry)?
    [quote author=“enature”]
    I see EPS closer to $2, which already puts the stock above $200 under old P/E. If you count P/E expansion then high $200s are justified.

    I’d like to see the details of how you go from the $2 EPS to the $200 target under old P/E. Not questioning your reasoning here, just curious what specific figures you’re using. In my case, the $181 target is 25 times F09 EPS estimate of $7.25.

    Thanks!

         
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    Posted: 27 October 2007 01:16 PM #5

    Deagol, I think your conservative number fails to take into account that in fact the iPod touch is the best seller, and likely to remain that way - followed by the nano, the classic, and finally the Shuffle.

    iPod ASPs are likely to rocket upwards this quarter in a quite unparalleled manner and I’m expecting 30M iPods with an ASP of over $200.

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    Posted: 27 October 2007 02:05 PM #6

    [quote author=“Tommo_UK”]
    iPod ASPs are likely to rocket upwards this quarter in a quite unparalleled manner and I’m expecting 30M iPods with an ASP of over $200.

    Thanks Tommo. Now that is a big rock you turned over. In my model it would represent $11.5b revenue and $2.18 EPS. I’m hoping you’re right, but I can’t count on it.

         
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    Posted: 27 October 2007 02:17 PM #7

    [quote author=“deagol”][quote author=“Tommo_UK”]
    iPod ASPs are likely to rocket upwards this quarter in a quite unparalleled manner and I’m expecting 30M iPods with an ASP of over $200.

    Thanks Tommo. Now that is a big rock you turned over. In my model it would represent $11.5b revenue and $2.18 EPS. I’m hoping you’re right, but I can’t count on it.

    I’m not counting on $2.18 but I am expecting around $2 .. fingers x’d wink

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    Posted: 17 November 2007 06:13 PM #8

    Thanks, Apple


    3m ending on Dec-2007:
    Apple gd: $9.2 b rev, $1.42 EPS
    Analysts: $9.32b rev, $1.53 EPS
    My estmt: $9.72b rev, $1.75 EPS
    26M iPods, 2.23M Macs

    12m ending on Sep-2008:
    My estmt: $32.71b rev, $5.40 EPS
    Analysts: $31.56b rev, $4.99 EPS

    Valuation (25 ? fwd EPS):
    Dec-2007 (fair value): $145, -13% dnside (Dec-2008 EPS $5.80)
    Sep-2008 (12m target): $181, + 9% upside (Sep-2009 EPS $7.24)
    Analysts mean target : $210, +26% upside

    http://www.esnips.com/web/aaplweborders

         
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    Posted: 17 November 2007 06:15 PM #9

    And I just realized I messed up again with the thread title when I created it. *sighs* sorry Tommo…

         
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    Posted: 30 November 2007 05:57 AM #10

    Deagol’s Q1 2008 Spreadsheet + Estimates

    Here we go…

    Best time of the year to follow Apple online orders. Enjoy!


    3m ending on Dec-2007:
    Apple gd: $9.2 b rev, $1.42 EPS
    Analysts: $9.32b rev, $1.53 EPS
    My estmt: $9.77b rev, $1.80 EPS
    26M iPods, 2.26M Macs

    12m ending on Sep-2008:
    My estmt: $33.04b rev, $5.51 EPS
    Analysts: $31.56b rev, $5.00 EPS

    Valuation (25 ? fwd EPS):
    Dec-2007 (fair value): $148, -20% dnside (Dec-2008 EPS $5.93)
    Sep-2008 (12m target): $186, + 1% upside (Sep-2009 EPS $7.43)
    Analysts mean target : $210, +14% upside


    http://www.esnips.com/web/aaplweborders

         
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    Posted: 30 November 2007 05:59 AM #11

    Deagol,

    I can’t understand how you come in with 1.80 on your unit sales numbers; I think your calculations must be not acknowledging the big increase in iPod ASPs, the impact of subscriber revenue sharing beginning to be felt, Leopard sales, and higher-than-expected gross margins… your EPS est seems very cautious; am I missing some risks you’ve accounted for?

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    Posted: 30 November 2007 06:18 AM #12

    [quote author=“Tommo_UK”]Deagol,

    I can’t understand how you come in with 1.80 on your unit sales numbers; I think your calculations must be not acknowledging the big increase in iPod ASPs, the impact of subscriber revenue sharing beginning to be felt, Leopard sales, and higher-than-expected gross margins… your EPS est seems very cautious; am I missing some risks you’ve accounted for?

    Thanks Tommo. My iPod ASP is slightly up at $165 [edit: this is for the whole 2007 calendar year, for the quarter I got $172] vs $163 last year and $159 last quarter. $120 million from revenue share doesn’t contribute that much yet. $466 million in SW sales includes a nice Leopard boost. Gross margins at 34.5%.

    Pushing iPod ASP’s to $170, SW to $500 million, and 36% GM gives me $9.94b in revenue and $1.95 EPS. What else are you seeing?

         
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    Posted: 30 November 2007 06:28 AM #13

    [quote author=“deagol”]
    Thanks Tommo. My iPod ASP is slightly up at $165 vs $163 last year and $159 last quarter. $120 million from revenue share doesn’t contribute that much yet. $466 million in SW sales includes a nice Leopard boost. Gross margins at 34.5%.
    Pushing iPod ASP’s to $170, SW to $500 million, and 36% GM gives me $9.94b in revenue and $1.95 EPS. What else are you seeing?

    I see iPod ASPs going over $200 thanks to the mix, the popularity of the nano and the availability of the touch. Hugely-rising iPod ASPs has been a pet theme of mine since August and I’m still confident its going to come about.

    iPhone subscriber revenue sharing I’m pegging at $220M for the quarter.

    I also think GMs are going to be around 36% (and possibly higher, though I know that’s hard to swallow) - margins on this year’s iPods are better, as they are on Macs. Taking additional AppleCare sales into account too and I think there’s a lot “hidden” from obvious view.

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    Posted: 30 November 2007 06:49 AM #14

    Deagol’s Q1 2008 Spreadsheet + Estimates

    That’s pretty amazing. I really hope you’re right, as always.

    I’m curious about how you get to 220 million from ATT, and I know there was a report suggesting a better iPod mix but I didn’t see the data. I think AppleCare revenue is also recognized through subscription accounting (2 years?). Finally, what do you have for operation expenses?

         
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    Posted: 30 November 2007 06:57 AM #15

    Re: Deagol’s Q1 2008 Spreadsheet + Estimates

    [quote author=“deagol”]That’s pretty amazing. I really hope you’re right, as always.

    I’m curious about how you get to 220 million from ATT, and I know there was a report suggesting a better iPod mix but I didn’t see the data. I think AppleCare revenue is also recognized through subscription accounting (2 years?). Finally, what do you have for operation expenses?

    From Appleinsider :

    Of the iPods sold as Munster and his team observed, 46 percent were iPod nanos, 19 percent were iPod classics, 19 percent were iPod shuffles and 16 percent were iPod touches.

    Using these percentages, I got $215 iPod ASP.

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    Tightwad.