Apple Stock Climbs $3.10 on Positive Analyst Estimates

Stock in Apple Computer (AAPL) closed up nearly 6% Monday after several analysts raised their earnings estimates on expectations of strong iMac and iPod sales.

Shares of Apple closed up US$3.10, or 4.95%, to $65.78, on volume of 22.2 million shares. Earlier in the session, the stock moved as high as $66.24.

As reported earlier Monday by The Mac Observer, J.P. Morgan Securities and First Albany increased their revenue and earnings estimates on Apple. J.P. Morgan Chase analyst Bill Shope reiterated an "overweight" recommendation on the stock, with expectations of fiscal year 2005 earnings of $1.69 a share on sales of $12.92 billion, up from prior estimates of $1.48 and $11.4 billion, respectively. First Albanyis Joel Wagonfeld also increased his estimates for the company and increased his price target to $72 from $61. He now believes Apple will post 2005 earnings of $1.57 per share on sales of $12.3 billion.

Also on Monday, Thomas Weisel analyst Kevin Hunt sharply changed his estimates on Apple, but downgraded the stock to "peer perform" from "outperform", putting a $59 price target on the stock.

"The long-term story remains positive for consumer spending in the electronics rapidly accelerating and Apple is clearly a key player at the center of this trend," Mr. Hunt said in a report to clients. "Why downgrade? The answer is that we believe that at the current valuation, the good times ahead are already priced into the stock."

The current consensus estimate of Wall Street analysts from Thomson First Call calls for Appleis 2005 earnings to be $1.42 on sales of $11.2 billion.