FY 3Q Results - Pre Game

  • Posted: 20 July 2009 02:14 AM

    After the 2Q con call we briefly discussed on AFB the cash flow results from the quarter.  Cash flow was down yoy, and some of us were not totally satisfied with Peter’s explanation.  This is a number that I eager to see, and will want to analyze a bit.

    As in every quarter, I place great importance on the Mac numbers.  Units, ASPs, and breakdowns.  I am bumping my estimate a teeny amount to 2.55.  I’ll be satisfied with anything over 2.40 and very pleased indeed if we get anything over 2.65.

    It is likely that $1.25 EPS will not move the needle on the stock, but I cannot see how we will beat that by much if at all.  More interesting to me is the non-gap number, which will get very little ink.  (12.5x the non-gap number is my bear market appx. value for AAPL, with 25x the bull market number.) 

    An upside surprise for iPhone sales is not out of the question.

         
  • Posted: 20 July 2009 03:15 AM #1

    capablanca - 20 July 2009 05:14 AM

    After the 2Q con call we briefly discussed on AFB the cash flow results from the quarter.  Cash flow was down yoy, and some of us were not totally satisfied with Peter’s explanation.  This is a number that I eager to see, and will want to analyze a bit.

    As in every quarter, I place great importance on the Mac numbers.  Units, ASPs, and breakdowns.  I am bumping my estimate a teeny amount to 2.55.  I’ll be satisfied with anything over 2.40 and very pleased indeed if we get anything over 2.65.

    It is likely that $1.25 EPS will not move the needle on the stock, but I cannot see how we will beat that by much if at all.  More interesting to me is the non-gap number, which will get very little ink.  (12.5x the non-gap number is my bear market appx. value for AAPL, with 25x the bull market number.) 

    An upside surprise for iPhone sales is not out of the question.

    If memory serves, the margin between analyst consensus and $1.25 you mentioned above is slimmer than in the prior quarter (Q2 09).

         
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    Posted: 20 July 2009 05:06 PM #2

    Gene Munster   Via AppleInsider

    Apple on Tuesday is likely to announce its best-ever June quarter for Mac sales, as new market data implies the company sold approximately 2.6 million systems during its third fiscal quarter.

    Macs

    In a note to clients Monday afternoon, Piper Jaffray analyst Gene Munster cited data from NPD which indicates that domestic Mac sales, which account for roughly 40 percent of the Mac maker’s shipments, rose 16 percent in June following the introduction of more affordable MacBook Pros.

    That’s much better than the flat to 5 percent increase Munster had been anticipating and, when analyzed alongside previously released NPD data for the months of April and May, lead the analyst to predict that Mac sales for the three-month period ended June could run as high as 2.6 million.

    If accurate, that total would not only trump Wall Street’s consensus estimates of 2.45 million Mac sales for the quarter, but also signal the best-ever June (fiscal third) quarter for Mac sales in Apple’s history. Additionally, it would imply year-over-year Mac growth of 5 percent.

         
  • Posted: 20 July 2009 05:43 PM #3

    Mercel - 20 July 2009 06:15 AM
    capablanca - 20 July 2009 05:14 AM

    After the 2Q con call we briefly discussed on AFB the cash flow results from the quarter.  Cash flow was down yoy, and some of us were not totally satisfied with Peter’s explanation.  This is a number that I eager to see, and will want to analyze a bit.

    As in every quarter, I place great importance on the Mac numbers.  Units, ASPs, and breakdowns.  I am bumping my estimate a teeny amount to 2.55.  I’ll be satisfied with anything over 2.40 and very pleased indeed if we get anything over 2.65.

    It is likely that $1.25 EPS will not move the needle on the stock, but I cannot see how we will beat that by much if at all.  More interesting to me is the non-gap number, which will get very little ink.  (12.5x the non-gap number is my bear market appx. value for AAPL, with 25x the bull market number.) 

    An upside surprise for iPhone sales is not out of the question.

    If memory serves, the margin between analyst consensus and $1.25 you mentioned above is slimmer than in the prior quarter (Q2 09).

    Yes, I think you are correct.  The huge majority of WS analysts are between $1.13 and 1.27.  Deagol, Miller, and Zaky range from $1.27 to 1.34; the reason I am a little lower than the “big three” is my concern that GM may be below 35. 

    When looking up the EPS estimates, I noticed that iPhone estimates on WS are pretty much between 4.24 and 5.00 with the notable exception of iPhone skeptic Sacconoghi who is forecasting 3.70.  (Toni S. is, of course, the guy who argued as late as last summer that Apple would only sell 7mm iPhones in all of 2008; I have yet to read his mea culpa.)

         
  • Posted: 20 July 2009 06:19 PM #4

    capablanca - 20 July 2009 08:43 PM

    ...with the notable exception of iPhone skeptic Sacconoghi who is forecasting 3.70.  (Toni S. is, of course, the guy who argued as late as last summer that Apple would only sell 7mm iPhones in all of 2008; I have yet to read his mea culpa.)

    Thought I’d do a bit of a google news search to see what he’s been up to lately - I quite like this from Barron’s:

    Now, companies are stretching lives of machines beyond four years. Bernstein Research hardware analyst Toni Sacconaghi, who rates Dell an Outperform, helped set the table for Dell’s meeting by predicting a PC upgrade cycle in a note published prior to the meeting. He thinks the shares could rise to 16.

    Though he seems to be betting on the wrong horse.

    On another report on which he is quoted we have this gem which is from a couple of days ago:

    Apple, which ranked 7th in share last year, has been struggling. While iPhone and iPod sales have boomed, its PC sales have been slipping around 3% year over year, and in May its share of units sold declined for the seventh month in a row, according to a Merrill Lynch report.

    ...

    The fact that Dell and Acer are the only pure-play PC makers in the top ranks (the Chinese government’s stake in Lenovo makes a sale of that company unlikely) led Bernstein Research analyst Toni Sacconaghi a couple of months ago to float the notion of Dell buying Acer.

    So strange twilight zone reporting of Apple there and seemingly bonkers predictions of a phoenix-like resurrection from Dell. I think it is best to stay away from Google news.

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  • Posted: 21 July 2009 02:49 AM #5

    Tiernan Ray writing in Barron’s.

    Among other analyst estimate updates is this:

    Vijay Rakesh, ThinkEquity: Rakesh sees iPhone sales ?rebounding sharply? with the availability of the $99 iPhone. He forecasts 5.5 million iPhones were sold last quarter. The new 13? MacBook Pro, meantime, probably led to ?strong? MacBook sales of 1.7 million, slightly ahead of Misek?s 1.5 million. Like Misek, Rakesh raises his revenue estimate for fiscal Q3 from $8 billion to $8.4 billion, and to $1.31 per share in earnings from $1.20.

    This is the highest iPhone estimate for the quarter that I recall seeing.

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