Apple Q2 2007 Financial Results on April 25, 2007

[MacRumors]

http://www.macrumors.com/images/macrumorsthreadlogo.gif (http://www.macrumors.com)

Apple will be webcasting (http://www.apple.com/quicktime/qtv/earningsq207/) a discussion of their Q2 2007 Financial Results on Wednesday, April 25, 2007.

Please note that comments made during this call may include forward-looking statements that are subject to risks and uncertainties, and that actual results may differ materially from these forward-looking statements. For more information on the factors that could influence results, please refer to Apple’s SEC filings.

The conference call begins at 2pm PT/5pm ET.

[liven2]

I have a very good feeling about this.... I think the numbers will be stellar!

[jrath1]

Big freaking deal...is this really a rumor?

[DsurioN]

Great, I hope they have some good results and they somehow leak some hints as to what's in store for the rest of the year... :D

[NewbieNerd]

Big freaking deal...is this really a rumor?

It's all we've got with Apple right now. I guess if they're so swamped with the iPhone right now that Leopard had to be delayed several months, they're probably too swamped to do anything else interesting. :(

[Konradx]

Shoud i buy some stocks before this?

[theheadguy]

Big freaking deal...is this really a rumor?
Calm down dude.
Mac Rumors: "news and rumors you care about"

[Grimace]

Even great profits don't help the AAPL price. The future outlook is really what investors are looking at these days. Mac sales are important too, but I wouldn't count on the stock price jumping. Stellar results the last MANY quarters and each time the stock has tanked because of Apple's cautious outlooks.

[twoodcc]

I have a very good feeling about this.... I think the numbers will be stellar!

yeah i think they'll be good also. even though the leopard delay will hurt the future sales

[Cinematographer]

I have a very good feeling about this.... I think the numbers will be stellar!

The iPod numbers are quite impressiv indeed. It looks like Apple has sold more than 11 million iPods in Q2 (cf. 100 millionth iPod anouncement). This is another Q2 record, of course, beating 8.5 million in Q2 2006 and 5.3 million in Q2 2005.

I'm not so sure about the Macintosh numbers though.

[c.joe.go]

Shoud i buy some stocks before this?

is this a serious question? it closed @ 93+ today............. :confused:

if this is serious you should do a lot of research before getting into stocks, particularly aapl.

[aafuss1]

Probably there'll be a question regarding the status of a iLife/iWork update.

[scu]

is this a serious question? it closed @ 93+ today............. :confused:

if this is serious you should do a lot of research before getting into stocks, particularly aapl.

aapl is now trading at 33.8x p/e. Earnings per share year to date is 2.77. If p/e remains unchanged and it announces .65 earnings per share for 2nd quarter, then the stock should trade at about 115 per share.

3.42x33.8=115

If the market feels that the p/e is too high and the stock should trade more in the 26 p/e range than the stock should trade at 95.76.

Many insiders feels that the actual earnings will blow estimates away and come in at about .85 a share or more. If that is the case than buying aapl at 93 a share is a steal and we should see a nice 10-15% return on investment over 3 months.

[zombitronic]

If you make lucky choices and have the starting cash, then yeah, AAPL can be a good stock in a company that you actually like. With about $5,000 and a trading site that lets you buy double what you can afford (thinkorswim), you'd have about $10,000 to spend on shares. Pick up 110 shares (10 to cover the $10 commission), sell it at a dollar more and ::BOOM:: you just made $100. Let it go down, buy again and repeat. You'll have paid for that iPhone in no time.

I'm sure you'll get dissed by some pro-traders that would call this a frivolous trading habit and that your money would be better off split up in smaller stocks, but it's your money. For very little effort, it has the potential to pay off.

[Cult Follower]

It always scares me, these quarterly results. You never know what to expect.

[IJ Reilly]

aapl is now trading at 33.8x p/e. Earnings per share year to date is 2.77. If p/e remains unchanged and it announces .65 earnings per share for 2nd quarter, then the stock should trade at about 115 per share.

3.42x33.8=115

If the market feels that the p/e is too high and the stock should trade more in the 26 p/e range than the stock should trade at 95.76.

Many insiders feels that the actual earnings will blow estimates away and come in at about .85 a share or more. If that is the case than buying aapl at 93 a share is a steal and we should see a nice 10-15% return on investment over 3 months.

What that the analysis was quite so simple. First, trailing PE is a virtually worthless statistic to look at for a growth company. It only tells you what has happened over the past four quarters and nothing about the future. For a company like Apple, the forward PE (currently at 24:1) is far more important, since it represents a consensus estimate of future earnings. If Apple fails to grow EPS at something like the difference between trailing and forward PE, and/or does not confidently predict that level of growth going forward, then they will probably be punished by the market. But even that analysis is too simple because the market values stocks based on far more than simple numbers.

Here's a good bottom line which has worked well in the past: If Apple doesn't beat expectations by at least 10%, then the stock will generally be drubbed the next day, because investors have already priced in at least consensus expectations. They want more and can be very disappointed when they don't get it.

[Apple Architect]

I am always shocked by some of the responses to the financial details/share price questions.

On one hand we have a group of people suggesting "use a site and buy twice what you can afford" and on the other the people claiming to use formula to predict share price.

The share price is exactly that, a price. It is what the market thinks the company is worth. As for news contained in the end of quarter report...if you believe in the strong form of Simple Market Hypothesis then everyone who ACTUALLY understands these things has already traded as the share price already reflects information that may or may not be in the public domain.

If you are thinking of buying shares to make a profit....then by a tracker to remove the risk associated with single shares. If you think that the shares are undervalued then buy them, but please only buy what you can afford to lose.

[IJ Reilly]

Excellent advice!

[scu]

What that the analysis was quite so simple. First, trailing PE is a virtually worthless statistic to look at for a growth company. It only tells you what has happened over the past four quarters and nothing about the future. For a company like Apple, the forward PE (currently at 24:1) is far more important, since it represents a consensus estimate of future earnings. If Apple fails to grow EPS at something like the difference between trailing and forward PE, and/or does not confidently predict that level of growth going forward, then they will probably be punished by the market. But even that analysis is too simple because the market values stocks based on far more than simple numbers.

Here's a good bottom line which has worked well in the past: If Apple doesn't beat expectations by at least 10%, then the stock will generally be drubbed the next day, because investors have already priced in at least consensus expectations. They want more and can be very disappointed when they don't get it.

I would agree with you in principal, however if that was the case then why hasn’t this stock increased more significantly from January 2006. It has beaten street estimates every quarter since then and Apple is growing at about 30% a year. Yet the stock is only trading 7% higher then it did 15 months ago. Wall Street has been too cautious for too long. I believe that blowout earnings this quarter will be the catalyst. We should start seeing aapl appreciating above $100 in the next 3 months. Guidance form Apple for 3rd quarter is key and we agree on that. But they have always given conservative estimates and I don’t see that changing. So it will be up to buyers to determine future value by accumulating the stock. Most analysts have the stock at 105-145 in the next 12 months.

[IJ Reilly]

I would agree with you in principal, however if that was the case then why hasn’t this stock increased more significantly from January 2006. It has beaten street estimates every quarter since then and Apple is growing at about 30% a year. Yet the stock is only trading 7% higher then it did 15 months ago. Wall Street has been too cautious for too long. I believe that blowout earnings this quarter will be the catalyst. We should start seeing aapl appreciating above $100 in the next 3 months. Guidance form Apple for 3rd quarter is key and we agree on that. But they have always given conservative estimates and I don’t see that changing. So it will be up to buyers to determine future value by accumulating the stock. Most analysts have the stock at 105-145 in the next 12 months.

The current mean/median 12-month forecast is $110-115. I've never seen these analyst predictions ground-truthed, so I don't know how much trust to put in them. Recall when they announced last quarter's blowout numbers, AAPL actually went down substantially because at the very same time, they advised caution going forward. This was taken by investors as a sign that Apple was signaling less growth to come. The market reacted accordingly. Most companies are conservative in their predictions. Investors know this is a constant and also price the stock accordingly. I believe this is why my rule of thumb (consensus EPS+10% or bust) seems to work.

[Mulyahnto]

It'd be interesting to see the number of ipods and macs sold this quarter. I think consensus is about 10.5M ipods and 1.4M macs. Which would bring in about $1.7B for ipods (@ $160 avg price) and $2.1B (@ $1,500 avg price) for macs. Given that these core products bring in about 2/3-4/5 of total revenue, this results in a very pedestrian $5B quarter. In fact TFC states $5.17B @ $0.64 EPS. I'm hoping for about 12M ipods and 1.5M macs sold this quarter. The year ago quarter sold 8.5M ipods and 1.1M macs.

[Mulyahnto]

AAPL's current market cap is around $80B. Last quarter's shareholder's equity was about $10B, essentially the assets of the company if it were to stop operations immediately, ignoring all intellectual property. A disparity of $70B. This disparity indicates that we think AAPL will evantually be worth the $80B the cap is at right now. If we factor a 10% earnings growth rate, and ignoring investment incomes, the $70B is earned back in about 15 yrs when earnings are projected at $9B compared to today's $2B. If AAPL's cash pile will reach its yearly revenue, it might be time to bring back divident payouts, or a stock buy-back program, it's both good for the investors and for a healthy company.

[Willis]

less than 3 hours to go...

[Rocketman]

Unique subscription based regognition of iPhone sales on a straight-line basis over 24 months. Allows Apple to provide FREE software upgrades over time to existing iPhone owners.

Earnings on service fees to be recognized on an "as earned" basis.

The odd thing about this will be a "rolling recognition" of iPhone related revenues thus smoothing earnings recognition.

Rocketman

[scu]

aapl is now trading at 33.8x p/e. Earnings per share year to date is 2.77. If p/e remains unchanged and it announces .65 earnings per share for 2nd quarter, then the stock should trade at about 115 per share.

3.42x33.8=115

If the market feels that the p/e is too high and the stock should trade more in the 26 p/e range than the stock should trade at 95.76.

Many insiders feel that the actual earnings will blow estimates away and come in at about .85 a share or more. If that is the case than buying aapl at 93 a share is a steal and we should see a nice 10-15% return on investment over 3 months.

aapl is a steal at 108. In six months it will trade over 120.

[pnyc]

Thanks for the advice.

[IJ Reilly]

aapl is a steal at 108. In six months it will trade over 120.

Or you will personally make up the difference, right?

[scu]

Or you will personally make up the difference, right?


You bet.:p

There are two conditions. First you have to show that you bought it no later then Monday, May 14.

Second, my limit of reimbursing is only up to 200 shares to the first person who actually shows proof they bought them on Monday.

So if you bought 200 shares at 108 on Monday and come Nov 14 if aapl trades at 120 I don't owe any money. But if it trades at 110 then I will owe that person $2k.;)

But since that person already has $21600 to spend, I would suggest they buy a couple iPhones and a new MacPro 8core and with the rest buy stock.:D

[IJ Reilly]

Sign here, here, and here.

:)

[scu]

Sign here, here, and here.

:)

The recent rise of the stock from 100 to 108 took me by surprise. Someone has taken my advise and is able to accumulate millions of dollars in stock.:) We will see if it continues after Apple announces Leopard and then tells us they have 1 million phones ordered for release June 28.:D

[IJ Reilly]

This may be one of those classic "buy on the rumor, sell on the news" situations. Clearly the market's expectations are very high. The higher they get, the harder they'll be to fulfill. We shall see.

[scu]

You bet.:p

There are two conditions. First you have to show that you bought it no later then Monday, May 14.

Second, my limit of reimbursing is only up to 200 shares to the first person who actually shows proof they bought them on Monday.

So if you bought 200 shares at 108 on Monday and come Nov 14 if aapl trades at 120 I don't owe any money. But if it trades at 110 then I will owe that person $2k.;)

But since that person already has $21600 to spend, I would suggest they buy a couple iPhones and a new MacPro 8core and with the rest buy stock.:D

Well we are not quite 6 months. But aapl just hit 163 in AH trading.

come Dec I think we will hit 180:D

[IJ Reilly]

Well we are not quite 6 months. But aapl just hit 163 in AH trading.

come Dec I think we will hit 180:D

A thread is risen from the dead!

Don't get me wrong, I'm more than pleased. But let's not lead the unsuspecting into believing that anything in the stock market is somehow guaranteed. AAPL did pull a gut-wrenching 20% dump during this time period, you know.

[scu]

A thread is risen from the dead!

Don't get me wrong, I'm more than pleased. But let's not lead the unsuspecting into believing that anything in the stock market is somehow guaranteed. AAPL did pull a gut-wrenching 20% dump during this time period, you know.

Oh I agree. Nothing is guaranteed. As long as the markets are healthy aapl will reach 180.

I was not happy when aapl hit 111 back in August. We will have corrections, but long term aapl is only going up:cool:

[brilami]

apple will reach easily 180 after next earnings.

buy them b4 10/22

[skunk]

I was not happy when aapl hit 111 back in August. I was. I bought a load more shares. :)

[IJ Reilly]

apple will reach easily 180 after next earnings.

buy them b4 10/22

Money back if not completely satisfied?

I was. I bought a load more shares. :)

I thought you sold out about a year ago, when the options scandal was in full swing. No?

[skunk]

I thought you sold out about a year ago, when the options scandal was in full swing. No?In the end I hung on. Glad I did. :)

[scu]

aapl now at 165.69:D:D:D

[IJ Reilly]

In the end I hung on. Glad I did. :)

And what did you win? An all-expenses paid round trip holiday to Cupertino!

aapl now at 165.69:D:D:D

Yikes. Now all I can think about was the shares I sold a few years ago, instead of the ones I've still got.

[skunk]

And what did you win? An all-expenses paid round trip holiday to Cupertino!No, a nice 24" iMac and a MacBook. That'll do for starters.

[IJ Reilly]

No, a nice 24" iMac and a MacBook. That'll do for starters.

As you say, for starters. If you're waiting for my advice, which of course you aren't, cashing in about 20 shares would more than pay for a blowout San Francisco holiday, say, right around the beginning of next January.

[scu]

rumor has it that aapl might split in the near future if it goes over 200.

this may not happen until April of next year.

I for one plan on buying as many as I can afford

Attending SF Macworld would be awesome in Jan. Plan on doing so.:)

[skunk]

cashing in about 20 shares would more than pay for a blowout San Francisco holiday, say, right around the beginning of next January.Tempting timing indeed. :) Last time I was in San Francisco was about 25 years ago: what's the weather like in January?

[IJ Reilly]

Tempting timing indeed. :) Last time I was in San Francisco was about 25 years ago: what's the weather like in January?

Can vary quite a bit depending on the timing of the Pacific storms which normally come at that time of year, but I can recall only one year in the last ten when MacWorld was really rained on. Otherwise you can generally count on highs in the 60s and lows around 50. Better than the south of England at that time of year. ;)

[scu]

I want to bring this thread back to life.

I want to remind people that Apple is a sure bet.

We are moving higher and faster then I even envisioned.

Now this that quarter is behind us (4th quarter 2007) it is time for more bold predictions.

Apple will be past 225 by Jan 18, 2008


It will be past $270 a year from now.

And we will hit $675 by mid 2010.

From time to time I will bring this thread up so people who have not invested it can be reminded that it is not too late.

[IJ Reilly]

Now that's funny. A couple of weeks ago you were agreeing with me that nothing in the stock market comes with a guarantee.

[scu]

Now that's funny. A couple of weeks ago you were agreeing with me that nothing in the stock market comes with a guarantee.

Of course nothing is guaranteed in life. Events can take place that would make these predictions not come to pass.

But there is always a risk when betting the farm on something. But if one invests wisely like aapl, the risk is worth taking.

Apple is a different animal now then it was back in April. Leopard will rock this world and then after 40 million iPhones are sold in 09 around the world watch the 2nd Halo affect kick in.

We have reached the tipping point.

Enjoy this company, its products, and eventually you can even get filthy rich from it.:D

[IJ Reilly]

Apple's OS releases haven't typically made a major impact on the company's bottom line, and I don't expect Leopard to be any different. This is not what is driving revenue.

The biggest worry I've got now in terms of the future for AAPL is the overall state of the economy and the stock market. Even good issues get dragged down when the markets get a serious case of the yips.