Apple Inc. (AAPL) will surprise
9-25-07: The end of the 3rd quarter is upon us. It is time to predict some earnings. One of our favorite is Apple Inc. Steve Jobs and company is on a roll and we fully expect AAPL to post a very strong earning, easily surpassing estimates. There are several positive signs for our bullish prediction.
First, the iPhone is definitely a hit. The company easily surpassed its goal. In fact the product is so successful that Apple was able to slash the price by $200 without much though. Second, demand for its desktop and laptop remains strong. Try visiting the Apple store at your local mall and you will see. The place is packed with young kids. I guess owning an Apple computer is cool. Third, itunes is killing everyone and will continues to dominate online music downloads. In our view, the debate between whether people want to buy versus rent music is clearly evident. Customers wish to own! Apple's model confirms it.
All in all, it appears all of Apple’s units are rolling along nicely. We realized the stock is a bit on the high end ($153 as of 9/25/07), but we believed AAPL’s valuation is justified given its strong momentum. If our prediction is right, we will see AAPL at $200 per share by end of 2007. Look for opportunity to buy AAPL, perhaps on the next market correction.
Comments
Do you have any idea when the next correction will be? I was always thinking about buying, but it always seemed too high and liable to go through a price correction.
Posted by: tim | September 25, 2007 03:16 PM
In our opinion, the market is currently over bought. Everyone seems to think just because the Feds lowered short term interest rates everything is going to be OK. As for when we believed the next correction will occur..when the next employment report is released. Our prediction is the number will spook investors and the market will panic. Good Luck!
Posted by: ibooyah | September 25, 2007 04:00 PM
I have weighed the question of when to get in to AAPL before, and whenever I have wanted to get in, I always thought it should dip maybe 5-10% more from where it is at, and then i'll get in. Problem is that never happened. So one day I thought, OK I'll pay a 5% premium (on what I think it should be) and get in, and i've held it since then. IMHO AAPL is a high Q stock, getting in at bargain levels only happens every 5-7 years perhaps.
Posted by: stockboy | September 25, 2007 05:05 PM
Looks like the "booyah" moment occurred today with the earnings report. I've read where the expected top of around $200 per share. What do you think?
Posted by: Adam | October 22, 2007 01:11 PM