Gearing up for 2H12
Price (12 Jul 12, US$) 598.90
Target price (US$) 750.00¹
52-week price range 636.23 - 353.21
■ Results on 24th July, reiterate Outperform. For F3Q12, we expect revenue/ EPS of $37.4bn (-5% qoq/+31% yoy)/$10.15 vs. consensus at $37.3bn/$10.33. We expect group GM of 42.4% for the quarter, though better than expected iPhone mix could drive upside to our estimate. Our FY12/FY13 EPS estimates stand at $46.27/$56.75. Given our view that Apple is well positioned to maintain momentum across key product lines driven by continued innovation in hardware, software and services, we reiterate our Outperform rating and TP of $750.
■ iPhone building toward strong C4Q12. We recently reduced our iPhone estimates to reflect increased carrier discipline on smartphone subsidies in the US. Our iPhone volume estimate for F3Q12 stands at 28.5mn units (-19% qoq/+40% yoy) and we see the potential for slight upside in the quarter. However, given low smartphone penetration, carriers’ inability to ‘collude’ for a sustained period of time, and the roll out of LTE/4G technology, we believe that these pressures on iPhone volumes may be a short term phenomenon. We forecast 26.5mn units (-7% qoq/+55% yoy) in F4Q12 followed by a stronger than seasonal 50.3mn units (+90% qoq/+36% yoy) in F1Q13 (calendar Q4) buoyed by the iPhone 5 launch which we expect in late September/early October. For CY12/CY13, we forecast 140mn/187mn iPhone units which implies global smartphone market share of 21%/22% respectively (up from 19% share in 2011).
■ iPad room for upside; continued strength in 2012. In the first full quarter of sales of the new iPad, we view our forecast of 14.7mn units (+25% qoq/+60% yoy) as achievable in the current environment. Amongst an increasingly competitive landscape, we forecast Apple’s tablet share dropping from 62% in CY11 to 50% long-term, though this may prove conservative given company’s compute advantage and aggressive pricing (something we discussed in detail in our note ‘Compute Market Update – Raising estimates, tablets driving growth’ dated 10 July 2012).
■ Valuation remains attractive. Trading on a P/E of 10.1x our CY13 EPS estimate of $59.15, valuation remains attractive given earnings CAGR of 30% between CY11-13E, LT EPS power of $75, and net cash of $117/sh.
Source/Extract/Excerpts/来源/转贴/摘录: Credit Suisse