The Countdown to Apple (AAPL) F3Q Earnings Begins; Top Analyst Weighs in on the Stock


OK, Apple (NASDAQ:AAPL). It’s officially earnings season again, and time to show investors what you’re made of. The tech giant is set to release fiscal third-quarter results after the market closes Tuesday. With AAPL shares climbing about 15% since it last reported in early May, now is a great time to take a closer look at what we should expect.

Monness’ top analyst Brian White believes Apple will meet his 3Q:FY18 revenue projection of $52.33 billion (Street is at $52.34 billion) and slightly exceed his EPS estimate of $2.17 (Street is at $2.18). White’s model reflects a 14% QoQ sales decline compared to an average fall of 16% over the past five years. Recall, Apple guided for 3Q:FY18 sales of $51.5-53.5 billion.

White noted, “We are not expecting any fireworks during this earnings report given the uncertainty inherent with any new iPhone launch that is usually reflected in Apple’s September quarter guidance, combined with an onerous foreign exchange headwind. However, we believe Apple’s strong software capabilities, expanding services business and unique digital ecosystem at large are increasingly being appreciated by the market. Despite this improved sentiment, we believe Apple remains one of the most underappreciated stocks in the world with a valuation that remains depressed.”

As such, White reiterates a Buy rating on Apple shares, with a price target of $235, which represents a potential upside of 23% from where the stock is currently trading.

According to TipRanks.com, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst Brian White has a yearly average return of 16.3% and a 67% success rate. White has a 18.5% average return when recommending AAPL, and is ranked #109 out of 4836 analysts.

Overall, as the countdown to Apple earnings starts, Wall Street’s confidence backing the stock is mixed. Out of 28 analysts polled in the last 3 months, 16 are bullish on AAPL stock, while 12 remain sidelined. With a slight return potential of 7%, the stock’s consensus target price stands at $203.58.

 

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