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Technology Stocks : Apple Inc.
AAPL 270.37-0.4%Oct 31 9:30 AM EST
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To: slacker711 who wrote (132563)4/30/2012 4:17:12 PM
From: XoFruitCake  Read Replies (3) of 213172
 
I see little reason to believe that Apple has suddenly given accurate gross margin guidance
the bullish side of me said that Apple management just want to sandbag everyone but the cynical side of me said that they really don' t know the component market too well.. For F2Q, they misguided by about 470 basis point. About 10% off the real GM. It seems like they are surprised by the dropping of NAND and mobil DRAM price, higher revenue and higher Iphone sales as a percentage (I think it is their way of saying Ipad margin will not be too good compare to Iphone. May be the next Iphone will have the same problem. As competition heat up, even though Apple was able to hold the price point, they need to cramp more feature into the product and drive up the component cost.. And margin/earning per unit suffer as a consequence). I think everyone miss F2Q, higher gross margin and hence everyone miss their earning. I came to $12 earning guesstimate but with 40m Iphone and 12m ipad sales (so I was obviously too bullish on Iphone). The question is what will be F3Q margin and I think I am like everyone else trying to scratch my head and figure it out ...

seekingalpha.com
Total company gross margin was 44.7%, which was 470 basis points higher than our guidance.About half of this difference was driven by lower commodity and other product costs. Another quarter was due to leverage on the higher revenue and some onetime items benefiting the quarter. And the remainder was due to better-than-expected mix largely from the record iPhone sales.
If Apple's shareprice were to stagnate for the next year, that number would drop to around 7.5 (using a rough estimate of cash and analyst estimates). Maintaining an ex-cash PE of 10 would put Apple around 700 next year
But over 60%(??) of the cash are oversea and there will be a 35% penalty for bringing them in. I was kind of disappointed that they did not do more on the buy back stock front. I think Iphone 5 will get us over $700. What I am not sure is whether that $700 is substainable for all of 13. i.e. if the sales momentum for Iphone 5 and Ipad 3/4 will carry the earning to over 50-60 earning range in 13. I am guessing that May to August will be tough for Apple stock and we will start to have more fun on Iphone 5 lanuch in Sept/Oct. If the feature list is good (and no supplier issue like the Qcom thingy), we may have a good 4Q sales and so is stock price. By Jan, it will be wait and see how the competitive landscape and sales number shape out..
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