All Eyes on Apple Inc. (AAPL) FQ4 Earnings Turnout Tonight

Brian White offers bullish insights into AAPL's FQ4 results today, as well as its next-level iPhone X launch.

Apple Inc. (NASDAQ:AAPL) is churnings its empire earnings wheels as Wall Street’s eyes are peeled to see the “doubleheader” this tech titan has in store, with Drexel Hamilton analyst Brian White joining a slew of analysts in charged anticipation of not one, but two key events: tonight’s fourth fiscal quarter print and tomorrow’s grand iPhone X in-store debut.

Ahead of both showstopper tech attractions, the analyst reiterates a Buy rating on AAPL stock with a $208 price target, which implies a just under 24% increase from where current levels. (To watch White’s track record, click here)

White wagers that this tech titan already has had a stellar start with iPhone X pre-orders, lending compelling upside potential prospects when looking at the writing wall for the upcoming 12 months. To put it bluntly, “Apple is taking the iPhone franchise to a whole new level with the iPhone X, pushing the company deep into the ultra-luxury smartphone market with the highest priced iPhone in the company’s history,” White cheers from the bullish camp.

For the fourth fiscal quarter, the analyst is angling for the tech titan to meet his sales expectations of $51.78 billion, which denotes a 10% year-over-year surge, above the Street’s forecast of $50.76 billion, while calling for an EPS beat against his $1.88 and the Street’s $1.87 estimates. White’s sales expectations predict a 14% quarter-over-quarter climb, which he notes is a far improvement from the usual five-year average quarter-over-quarter 7% lift seen this time in quarters of the past. Keep in mind that the AAPL management team’s fourth fiscal quarter guide has set expectations for $49 to $52 billion in sales coupled with roughly $1.84 in implied EPS.

In terms of the iPhone, for the quarter the analyst forecasts a 0.4% year-over-year dip to 45.4 million iPhone units, which positively suggests a 10% quarter-over-quarter rise. When taking under the account the iPad for the AAPL machine, the analyst models 9.8 million units, signifying expectations for a 5% year-over-year climb. Services look strong from White’s eyes, as the analyst forecasts a solid 21% year-over-year upturn to $7.6 billion in revenue for the segment. What looks less rosy are sales in Greater China, which though hit 18% growth in the third fiscal quarter could dip by 9% to 13% in the fourth fiscal quarter, writes White. Yet, it is worthy of note that “the sales cycle could turn positive on a quarterly basis in H1:FY18 and show growth for the full year FY:18,” the analyst adds, still staunchly in Apple’s corner ahead of tonight’s earnings show.

Glancing ahead to the first fiscal quarter of 2018, the analyst is just under the Street’s estimate of $85.97 billion at $84.86 billion, likewise gravitating under consensus of $3.81 in EPS with expectations looking for $3.65. White asserts, “However, we believe iPhone X supply will be the swing factor, not demand,” forecasting the AAPL machine will hit 27 million in iPhone X units along with 1 million in HomePod units.

Overall, “In our view, the 4Q:FY17 results and 1Q:FY18 outlook will carry less significance this earnings season as we believe the focus will be on the strength of this iPhone X cycle. Given this is Apple’s most unconventional iPhone launch ever with a staggered roll out across three models, there has been more confusion relative to past cycles. Already, iPhone X pre-orders appear to be experiencing strong demand and in-store availability begins tomorrow,” White surmises, enthusiastic for tonight’s double feature tech attraction that has all the Street with bated breath to see results. In fact, the analyst finds his iPhone average selling price and gross margin expectations to be “conservative” approaching the iPhone supercycle.

Overall, when it comes to Wall Street’s bet, the odds are on the iPhone Maker. TipRanks reveals that Apple has a Strong Buy analyst consensus rating with 19 back-to-back buy ratings in the last three months. Meanwhile the average analyst price target of $204.71 suggests the stock still has upside potential of just over 10% from the current share price for the next 12 months.

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