UBS Raises AAPL Estimates on iPhone, iPad Sales Projections

UBS analyst Maynard Um is raising is March quarter iPhone sales estimate from 7 million units up to 7.5 million, and he’s also bumping up his iPad sales estimates for the year to 2.1 million units in fiscal 2010 and 4.6 million in 2011. Mr. Um is raising his estimates based on higher than expected demand in the U.S. and overseas.

“Although we remain bullish on the long term evolution of the iPad into the central console for the home, over the near and medium-term, until we see more compelling apps to drive mass market adoption, we prefer to be cautious on overall adoption,” Mr. Um said.

His conservative estimates, however, seem to be limited to the iPad. Thanks in part to the iPhone’s reputation with consumers, Mr. Um sees continued growth in Apple’s smartphone marketshare.

Over a thousand respondents in a recent UBS survey indicated that 56 percent saw Apple as the best smartphone maker, and the study also showed that Apple sports over a 90 percent retention rate with iPhone customers. That retention rate is partially due to the high cost of switching to other phones along with the cost of losing iPhone app purchases since they aren’t compatible with other smartphone products.

Mr. Um is maintaining his “Buy” rating and US$280 target price for Apple’s stock. Apple is currently trading at $240.73, up 1.19 (0.50%).