The Mac Observer

Skip navigational links

You're viewing an article in TMO's historic archive vault. Here, we've preserved the comments and how the site looked along with the article. Use this link to view the article on our current site:
PJC: A Guide to Apple's Guidance

PJC: A Guide to Apple's Guidance

by , 4:10 PM EDT, October 20th, 2008

Apple is set to report its FY Q4 earnings on Tuesday. In the past, Apple has typically guided conservatively for the next quarter, hoping to beat the Street's estimates. This time, however, the task may be trickier given the state of the economy, and so Piper Jaffray's Gene Munster has provided some historical charts to assist with the assessment of Apple guidance for FY09 Q1.

Mr. Munster went back eight quarters and noted that during that time, Apple has guided on its earnings per share (EPS) about 9 percent below the expectations of the Street and 4 percent below on revenue. Then, when the actual earnings are reported, Apple blows away the EPS estimate by 27 percent and the revenue by 4 percent.


Source: Piper Jaffray

This time around, Mr. Munster predicts that Apple's guidance will be more conservative than usual. The problem is that if Apple guides too low, its stock will take a hit in the near term by investors who continue to be nervous about the economy. If Apple guides too high and doesn't meet expectations, the stock will take a similar hit in January.

Further complicating Apple's task is the fact that most of Apple's phenomenal Mac sales have occurred in July, August and early September, before the recent banking crisis surfaced. So no matter what Apple reports in terms of Mac sales, investors could be skeptical if Apple can maintain the pace. All eyes will be on Apple to see how they address that issue on Tuesday.

Mr. Munster expects Apple to report 2.8 million Macs sold, 11 million iPods, 5 million iPhones, revenue of US$11.42B and and EPS of $1.76. Despite everything that has happened with the stock market as a whole lately, he is holding to his target of $250 per share.

In afternoon trading, AAPL was at US$97.75, up $0.18 for the day.


If you are interested in Apple's stock, join our forum members in the Apple Finance Boards, a moderated forum for Apple Investors and people who are interested in Apple's financial dealings. For other stories regarding Apple's stock activity, visit our updated Apple Stock Watch Special Report.

Recent TMO Headlines - Updated July 22nd

Mon, 7:45 AM
You Don’t Get to Change Your Mind about The Past in the Future – Mac Geek Gab Podcast 771
Mon, 7:06 AM
Apple Applies for Apple Card Trademark in Canada
Sun, 5:41 AM
iOS 13 and iPad OS, Things We Like and Things We Like Less, with Andrew Orr - ACM 519
Fri, 6:31 PM
Apollo Space in the News, Apple's Russia Conundrum - TMO Daily Observations 2019-07-19
Fri, 6:29 PM
Boston Dynamics is Ready to Sell a Robot Dog: Spot
Fri, 6:28 PM
Help with Your 64-Bit Transition to macOS Catalina
Fri, 5:20 PM
In Honor of Apollo 11, Orbitrack Will Be Free on July 20th
Fri, 1:56 PM
Google Honors Margaret Hamilton With Portrait Bigger Than Central Park
Fri, 1:38 PM
2020 iPhones Could Get 5-Nanometer TSMC Chips
Fri, 1:30 PM
Twitter Tests a 'Label Replies' Option
Fri, 10:53 AM
Russia Ponders Law Making Local Smartphone Software Mandatory
Fri, 10:48 AM
macOS: 26 Trello Keyboard Shortcuts to Speed Up Usage
  • __________
  • Buy Stuff, Support TMO!
  • Podcast: Mac Geek Gab
  • Podcast: Apple Weekly Report
  • TMO on Twitter!