Tuesday, July 24, 2012

Apple Inc.(NASDAQ:AAPL) Turns Lower As Earnings Approach

Shares of Apple Inc.(NASDAQ:AAPL) turned briefly lower in afternoon session after opening higher in today’s session as the company is getting close to its much awaited third quarter earnings today after market close. The stock was down 0.08% to $603.22, off session high of $609.68. However, the stock is still sustained above $600 mark.

Apple Inc may see pre-launch pause in demand:-

As we all know that Apple has history of reporting much better than estimated earnings due to its dominant position in the smartphone industry. However, this time investors as well as analysts are bit cautious stating that the company’s recent quarter’s sales could be slower due an anticipated launch of iPhone5 by the end of this year.

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As a tech lover, anyone would prefer to buy the latest technology and therefore buyers are estimated to postpone their buying until the company launches its upgraded version.

Average analysts are estimating the company to report $10.36 a share in earnings and revenue of $37.18 billion. In a year ago quarter, the company had $7.79 a share on revenue of $28.57 billion. However, whisper earnings are estimating the company to report $11.89 a share. Not only profit and revenue is going to be critical, investors and analysts around the globe would look for the company’s sales of iPhone, which contributes the majority of revenues.

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Also, comments from the company would be closely watched regarding upcoming updates, net profit and net revenue target. In its last quarter, the company guided to earn $8.68 a share on revenue of about $34 billion. The company sees Q3 gross margins falling to 41.5%.

Analyst at Goldman projects Q3 revenues of $35.54B and EPS of $9.98. The firm believes buy-side expectations for iPhone units are already very conservative for Q3 at 26M-27M units -- relative to its 28M unit estimate.

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