Wall Street is bullish about Apple as shares soar to all-time highs (AAPL)
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Analysts are largely bullish on Apple's prospects after it reported better-than-expected results in its third-quarter earnings on Tuesday — sending the company's stock to record highs.
Apple beat Wall Street's expectations on both revenue and earnings, sending its stock jumping more than 5%, and also issued strong revenue guidance for the next quarter — hinting at the launch of an eagerly awaited redesigned iPhone in September.
Apple's stock is sitting close to $150.
In a research note, analysts for Macquarie wrote that the firm's call "was one of its most bullish in recent memory," and they touted augmented reality as a potential growth area: "We expect that in addition to being a key marketing and functional driver of iPhone hardware, AR is going to be directly monetized via the App Store ... We think AR will have some important near-term and many significant long-term implications for Apple and others."
William Blair, meanwhile, said it remained "bullish on the iPhone segment due to a combination of positive demand trends in emerging markets ... a weak competitive landscape in the smartphone space ... and the company taking an aggressive approach to enabling the device for next-generation applications."
Not everyone was so positive, though, with Barclays analysts warning that "pre-launch fervor" for the iPhone 8 "could get frothy" and that they remained "skeptical."
Business Insider has rounded up a load of analyst reactions to Apple's third-quarter results, and you can read them all below. We have illustrated their comments with charts from BI Intelligence.
But first, here are all the key numbers, via Business Insider's Kif Leswing:
- Q3 earnings per share (GAAP): $1.67, up 17% year-over-year, versus expectations of $1.57
- Q3 revenue: $45.4 billion, up 7% year-over-year, versus expectations of $44.95 billion
- Gross margin: 38.5%, up 1% year-over-year, versus expectations of 38.2%
- iPhone unit sales:41.0 million, up 1% year-over-year, versus expectations of 41.1 million
- iPad unit sales: 11.42 million, up 14% year-over-year
- Mac unit sales: 4.292 million, flat year-over-year
- Q4 revenue guidance: $49 billion — $52 billion versus expectations of $49.21 billion
UBS: BULLISH
Rating: Buy
Target price: $180
Comment: "It is striking how every part of the business is doing well. iPhone was flattish despite a pause with double-digit installed base growth. Services accelerated to a 22% increase. Macs gained share. iPad units were up a surprising 15% on a refreshed line. Watch units jumped by 50%. Then there is new product potential led by A/R, which plays to Apple's strengths. Investors are appreciating that this is a franchise and not just a product cycle play. That said, we like the iPhone 8 product cycle with its "pig in the python" upgrade potential and raise our price target from $170 to $180."
Piper Jaffray: BULLISH
Rating: Overweight
Price target: $190
Comment: "The outlook implies that fears of an iPhone X launch delay, and/or limited availability of the device, may have been overblown. We recommend owning AAPL due to growing anticipation around iPhone X and a favorable trajectory for services revenue."
Macquarie: BULLISH
Rating: Outperform
Price target: $180
Comment: "We thought AAPL's 3Q call was one of its most bullish in recent memory. Despite a coming big refresh, iPhone posted better than expected growth, and virtually all products in almost all geographies posted solid growth. Our focus remains on Services, and while AAPL didn't provide App Store growth, it is clear that Services will remain the key number-two driver behind iPhone for the foreseeable future. We also think it is important to note AAPL and Tim Cook's clear excitement about the potential for AR. We expect that in addition to being a key marketing and functional driver of iPhone hardware, AR is going to be directly monetized via the App Store. As Cook stated on the call, we 'couldn't be more excited about AR,' and despite our WAY too early call on VR, we think AR will have some important near- term and many significant long-term implications for Apple and others."
See the rest of the story at Business Insider
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