How Apple Goes Lower From Here

How Apple Goes Lower From Here
News
Like Us On Facebook
Like Us On Facebook

Europe’s debt crisis is already casting a shadow on second-quarter reporting season and even Apple(AAPL) may not be immune.

JPMorgan analyst Mark Moskowitz lowered price targets on 18 names in the information technologyspace on Thursday, citing concerns over slowing technology spending in the EMEA [Europe, Middle East and Asia] region as well as by the U.S. government.

Uncertain growth in China and currency pressures also factored into the call. Moskowitz kept an overweight rating on Apple but lowered his December price target on the stock to $695 from $715.

Even though Moskowitz believes that Apple is “still in a league of its own,” he dropped his earnings and revenue estimates for the company’s June-ending quarter by 0.5% and 0.8% respectively, putting him below consensus on both counts.

He now expects Apple to report fiscal third-quarter earnings of $10.20 per share on revenue of $36.8 billion. The average estimate of analysts polled byThomson Reuters is for a profit of $10.33 per share in the quarter on revenue of $37.33 billion.

Despite the near-term earnings reductions, Moskowitz is extremely favorable on the iPhone 5 launch, which he expects in September.

“We think that a combination of revolutionary hardware enhancements and software-driven services (i.e., Passbook, Maps, FaceTime over cellular) stand to reaffirm the iPhone as the leading smartphone in C2013, which is why our out-quarter iPhone estimates are increasing after a slight downward revision for the September 2012 quarter,” he wrote.

Moskowitz also identified three key growth drivers for Apple: “low market penetration rates in tablets, PCs, China, and the enterprise, the relative growth prospects of its key end markets versus other tech segments, and Apple’s role in enabling the burgeoning social media/networking adoption curve.”

The other companies seeing their price targets cut were Dell (DELL), EMC (EMC), HP (HPQ), IBM (IBM), NetApp (NTAP), Xerox (XRX), Brocade (BRCD), Aeroflex (ARX), Lexmark (LXK), Emulex (EMLX), Fusion-IO (FIO), National Instruments (NATI), Orbitek (ORBK), Qlogic (QLGC), Seagate Technology (STX), STEC (STEC), and Western Digital (WDC).

Shares of Apple were off nearly 1% at $569.28 in late morning action.

The Street

Share Tweet
React
Like Us On Facebook
Like Us On Facebook

Preston Waters

Preston Waters is a thinker. He's not your traditional philosophical persona, however, as he leaves no topic untouched. Covering all the bases, from business to women, Preston Waters is the ultimate man's man for Gen-Y.

More In News

World John Haltiwanger

ISIS Makes $3 Million A Day, Bringing In More Than Most Businesses

When ISIS first began, it relied on the assistance of other states in the region for funding: Saudi Arabia, Kuwait and Qatar. Now, however, US intelligence officials and other experts contend that ISIS makes $3 million a day from oil revenue, human trafficking, theft and extortion. Simply put, it is a finely tuned financial machine. […]

World Emily Arata

Americans Overwhelmingly Prefer Drinking Red Wine Over White Wine

Bring on the purple lips, wine teeth and grape-colored stains on otherwise clean white shirts. Americans have spoken, and they’re drinking red wine instead of white. A poll conducted by wine retailer CorkGuru shows that 58 percent of the US prefers a merlot to a chardonnay. As consumers get older, they like red wine even […]

Also On Elite

Humor

Exhausted Cat Just Wants To Nap Using A Watermelon For A Pillow (Video)

Japan is known for its famous cats (Maru, anyone?), but this sleepy guy may spark a new trend in kitty videos. The video shows a ginger cat trying to get some shut-eye. Unfortunately, he’s chosen to use a watermelon for a pillow. As the cat’s head slowly slips off the rock-hard fruit, he wakes up […]

Technology

16 Annoying Things About The Previous iPhones That The iPhone 6 Will Fix

With every release of a new iPhone model comes the heavy anticipation of new features. It’s not just about what the new phone will have, but what stupid things you couldn’t avoid on the last phone that will be taken care of this time around. This year in particular, Apple has got its users covered. With […]

Humor

Guy Goes On Wild Rant After Someone Steps On His Foot On The Subway (Video)

Thanks to my relatively sheltered upbringing and a general lack of adversity in my daily life, I can say with certainty that having to use public transportation is one of the worst things I’ve ever had to endure. It certainly has its perks, but those perks are far outweighed by almost every other frustrating aspect, […]