Some of Wall Street’s biggest names have been stepping up to the earnings plate and none come bigger than Apple (AAPL). The tech giant will report 2QFY21 results today after the close, and Monness analyst Brian White expects the company to deliver the goods.
“We believe Apple will at least meet our 2Q:FY21 revenue estimate of $79.75 billion (up 37% YoY; Street at $77.10 billion) and our EPS projection of $1.03 (Street at $0.98). Our 2Q:FY21 forecast reflects a 28% QoQ decline in revenue, less seasonal than the four-year average of down 33% QoQ for past March quarters,” the 5-star analyst said.
The better March quarter display, says White, is down to last year’s “later-than-seasonal” fall launch of the new iPhones.
The analyst estimates that for the second consecutive quarter, iPhone revenue will remain “in growth territory.” White forecasts a 47% year-over-year increase in iPhone sales, accelerating from the 17% growth displayed in the previous quarter.
The analyst also expects Apple’s iPad and Mac lineup to “shine,” a direct result of the WFH environment which has caused an uptick in demand for PCs and tablets.
In fact, White says the pandemic has only improved Apple’s global reputation.
“During this crisis, we believe Apple has enhanced its value proposition in the eyes of people around the world by introducing new innovations, supporting a more digital lifestyle, and attracting new consumers to Planet Apple.” There were plenty of new innovations on offer in the recent “Spring Loaded” event, White notes, including the introduction of the M1 chip to the iMac and iPad portfolios.
Looking ahead, the analyst’s estimates are also higher than the Street’s. For 3QFY21, White anticipates sales to increase by 24% year-over-year to $74.07 billion, while consensus has $68.85 billion. EPS is expected to hit $0.88, above Wall Street’s call for $0.82.
All in all, White rates Apple shares a Buy, along with a $170 price target. The implication for investors? Upside of 26%. (To watch White’s track record, click here)
The Street’s average price target is a more modest one; shares are expected to appreciate by 12% over the coming months, given the figure stands at $150.90. Overall, the analyst consensus rates the stock a Moderate Buy, based on 20 Buys, 2 Holds and 2 Sells. (See AAPL stock analysis on TipRanks)
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Disclaimer: The opinions expressed in this article are solely those of the featured analyst. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.