Credit Suisse First Boston Raises Apple Forecast

Brokerage firm Credit Suisse First Boston raised its estimates for Apple Computer Tuesday following internal research that revealed both the iPod shuffle and Mac mini are selling better than expected.

CSFB said it expects Apple will have shipped 1.5 million iPod shufffles when the quarter closes, along with 4.2 million iPod and iPod minis. Additionally, Mac mini shipments are higher than CSFB initially anticipated; the firm now expects Apple will have sold 150,000 of the computers when the quarter ends.

CSFB said its numbers reveal both iPod and Mac demand tracking above normal seasonal patterns, echoing a J.P. Morgan report yesterday.

For Appleis second-quarter, ending March 31, CSFB expects Apple to post earnings of $0.25 per share on revenue of $3.2 billion, up from earlier estimates of $0.20 per share on revenue of $2.9 billion. J.P. Morgan also raised its second-quarter estimates yesterday, to earnings of $0.24 per share on revenue of $3.23 billion.

CSFB also raised its fiscal year 2005 and 2006 estimates for Apple, to earnings of $1.15 per share on sales of $13.4 billion and $1.35 per share on sales of $15.2 billion, respectively.

"Following the breadth of positive data we uncovered during the quarter, we believe Apple is attracting new users at an increasing rate and successfully navigating the low-end of the PC and music markets," the research note said.

The firm maintained a neutral rating on Apple, believing that the stockis valuation -- trading at 31 times fiscal year 2005 earnings -- is priced accurately. CSFB has a 12-month price target of $40 on Apple; shares closed Monday at $40.32.