Along with high demand for the iPhone and iPad, Mr. Um is also seeing strong interest in the company’s Mac lineup. “We see gross margin upside from multiple sources: 1) favorable component pricing, 2)potential warranty accrual reversal, 3) lower back-to-school promo ($100 gift card vs.prior $229 iPod touch), and 4) potential reversal benefit from Nokia settlement.”
Mr. Um also raised his EPS estimates for Apple’s third quarter from $5.73 up to $5.88. He added “For fiscal year 2011, our new estimates are $104.8 bilion/$25.26 (prior $104.7 billion/$25.11).”
Apple will be hosting its third quarter earnings conference call after the market closes on July 19.
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Mr. Um is maintaining his “Buy” rating and $510 target price for Apple’s stock. Apple is currently trading at $359.57, up 5.82 (1.65%).
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