Hewlett Packard downgraded

Since Quarter 1 earnings have come out for Hewlett Packard and I have re-evaluated the stock and downgraded from out-perform to just perform. The new target price based off my new valuations will be $54.32 per share from the previous valuation of $57.26 per share. This is based off poor guidance set forth by Hewlett Packard during the conference call about discussing earnings for the quarter. As well as delay in new products offered and sluggish performance in sales to commercial clients being down 12%.

Chris Whitmore, analyst at Deutsche Bank.
"We believe it could be a rocky road going forward as the transition to a revenue-driven story will likely take considerable time,"

A Huge Disappointment is the delay in the debut of the Webos Touchpad the "Timing of all our WebOS products (and) Wi-Fi version of TouchPad available in summer in the US, and rest of the world in the fall." This has already been delayed tremendously. It will be very difficult HP to gain strong makret share while Apple will most likely have their second generation Ipad out by then.

Jonathan Wiener

AAPL F2Q10 Earnings 04/20/09-(Daren Pon)

Revenue was $13.5 billion, a 49% increase year over year. Net income rose 90% year-over-year to $3.1 billion. Margins were slightly higher than expected at 41.7% versus guidance at 39%. Cash and short-term securities increased from $39.8 billion to $41.7 billion quarter-over-quarter. This was the best non-holiday quarter in Apple history.After yesterday's earnings release after the bell, Apple shares closed today at $259.22, for a gain of 5.98% for the day.

Strength was attributed to iPhone sales doubling and strong momentum across the boards, allowing Apple to avoid the great magnitude of their normal seasonal sales declines after December. New Intel processors and NVIDIA graphics chips were added to the Apple's computer and laptop lines providing better performance, crisper graphics, and improved battery life. Mac revenue increased 33% and iPod revenue grew 12% year-over year. iTunes delivered over $1.1 billion in sales, a quarter best. 8.75 iPhones were sold, a year-over-year increase of 131%, crushing the IDC estimate of 41% due to expansion in Asia, Australia, Japan, and Europe. As mentioned in an earlier post, the iPhone OS4 is due this summer and will have multitasking, folders, improved enterprise support, and iAds. Retails sales increased by 22% year-over-year.

I still feel that Apple will outperform the broad market going forward this year due to their premium product lineup, an unparalleled user experience, and an application market that is light years ahead in development of quality software (I own a Motorola Droid, the Google Marketplace is a joke). Every single community service related event on campus with a raffle/prize is using either an iPad or Apple gift certificates to draw in students and the Apple store is STILL always crowded at Crossgates Mall. I am raising my one year price target to $315, looking forward for a potential Verizon iPhone contract this summer and continued increases in market share in the Mac product segment as iPhone users spill off into new Mac owners.

Apple - New iPhone OS Update

Apple will bring multitasking features to the iPhone in the next operating system update mid-year and will also be entering the advertising business by embedding ads within app store applications, taking a 40% cut of revenue.

http://blog.newsweek.com/blogs/techtonicshifts/archive/2010/04/08/apple-s-modus-operandi.aspx

AAPL Closes Above Price Target

Apple closed at $235.84 a share, crossing above our target price of $235.00 per share. This weekend marks the opening sale of Apple's iPad devices on April 3rd. Street consensus for unit sales are around 3-4 million for the year, with more optimistic expectations from Goldman and Morgan closer to 6 million. According to the Motley Fool, suppliers are expecting to ship 8-10 million units in 2010.

AAPL: Apple Sues HTC, Maker of Google Android Based Smartphones

http://online.wsj.com/article/SB10001424052748703807904575097392317555912.html?mod=WSJ_Tech_LEADTop

AAPL: The iPad Launch

Engadget: iPad Launch Day Roundup
Motley Fool: Does Apple Need the iPad to be a Winner?

AAPL F1Q10 Earnings 01/25/10-(Daren Pon)

Apple Inc. posted its best quarter ever in terms of quarterly revenues and earnings. Quarterly revenues were up 32% to $15.68B and quarterly net income increased over 50% to $3.38B, assisted by a record operating margin of 30.1% for the quarter. Earnings per share were $3.67 per share, which beat a consensus estimate of $2.08 per share by $1.59 and likewise topped their own guidance of $1.70 to $1.78 per share. This represents earnings per share growth of 46.8% year-over-year. Cash and marketable securities increased by $5.8B from $34B to $39.8B. Apple shares rose by as much as $5.26 to $208.33 in afterhours trading after their earnings release, an increase of 2.58%. This represents a gain of about 117% on UASBIG’s original position.

Quarterly records for Mac and iPhone sales were set for the quarter. Mac sales increased by 33% year-over-year nearly double the 17% growth for the market estimated by the IDC for the same quarter, while Apple sold over 8.7 million iPhones for the quarter, an increase of over 100% versus an estimated 35% growth estimate for the smartphone industry made by Canalys. 17 new carriers were added and there is now iPhone distribution in 86 different countries.

Unit sales of music players decreased from 22.7 to 21 million units year-over-year, but strong demand for the higher priced iPod Touch products boosted sale revenues by 1%. Apple still maintains a commanding 70% market share for United States MP3 players.

Apple continues to exceed analyst beat expectations, although the record numbers are not incredibly surprising given the new revenue recognition accounting changes that were approved by FASB in the latter end of 2009. These changes allow Apple to recognize sales of iPhones and Apple TV immediately, rather than on a subscription basis spread over a 24-month period. The intensity of the smartphone industry is increasing with the emergence of Google-based phones such as the Motorola Droid and the Google Nexus One, but neither is at quite the same level and they are merely serving as substitutes to the iPhone on non-AT&T carriers. Going forward, UASBIG has a tentative price target of $235, subject to the new product launch at 1PM this Wednesday and any divergence from the single wireless carrier model in the United States.

Rumors of $99 iPhone 3GS by the Holiday Season

http://www.tomsguide.com/us/Apple-99-iPhone-3GS-AT-T,news-5051.html

25 Things the iPhone has Rendered Useless

http://www.maclife.com/article/feature/25_things_ipod_has_rendered_useless

Apple Can Remain Great Without Jobs

http://gizmodo.com/5352100/inside-steves-brain-apple-can-remain-great-without-mr-jobs

Apple Could Benefit From Possible Accounting Rule Change

http://blogs.barrons.com/techtraderdaily/2009/09/14/apple-could-benefit-from-possible-accounting-rule-change/?mod=wsjcrmain

AAPL: Why Apple Is More Valuable Than Google

Business Week Article:
http://www.businessweek.com/technology/content/aug2009/tc20090811_324273.htm

AAPL F3Q09 Earnings 07/21/09-(Daren Pon)

Apple (AAPL) this evening reported fiscal third-quarter results that beat analysts’ sales and profit estimates.

Apple revenue rose 12%, year over year, in the quarter to $8.34 billion, while net income came in at $1.23 billion, or $1.35 per share.

That compares to an average estimate for $8.2 billion in sales and $1.17 per share, or $1.31, excluding options expenses. The results were ahead of Apple’s own forecast for revenue of $7.6 billion to $8 billion and profit of 90 cents to $1 per share.

Gross profit was likely much higher than people’s grim expectations, 36.3%, up from 34.8% percent in the year-earlier quarter.

For the fourth quarter, Apple, as per usual, offered a rather restrained forecast, projecting revenue of $8.7 billion to $8.9 billion and EPS of $1.18 to $1.23, less than the $9.1 billion and $1.30 analysts have been projecting.

Apple shipped 5.2 million iPhones in the June quarter, 10.2 million iPods, and 2.6 million Macs, the company said.

The reported sales and profit don’t include some proceeds from iPhone that are recognized ratably over months that a phone is owned. Including those non-GAAP amounts, Apple generated $9.74 billlion of “adjusted sales” and $1.94 billion of “adjusted net income.” On a per share basis, using a diluted share count of 909.2 million shares, that comes to about $2.13 per share in adjusted EPS, I reckon.

Apple generated $2.3 billion in cash flow from operations in the quarter, the company said.

Apple will host a conference call with analysts at 5 pm, which you can listen to here. http://www.apple.com/quicktime/qtv/earningsq309/

Despite the restrained forecast, Apple shares rose $5.73, or 3.8%, to 157.24 in after-hours trading, after falling 1% during the regular session.

Source: http://blogs.barrons.com/techtraderdaily/2009/07/21/apple-q3-rev-eps-beat-52m-iphones-sold-stock-rises/

AAPL F2Q09 Earnings 04/22/2009-(Daren Pon)

This past Wednesday Apple Inc. released their F2Q09 report. Revenues increased 8.7% to $8.16 billion and profits increased from $1.05 billion to $1.21 billion, or from $1.16 to $1.33 per share. Gross margins increased from 32.5% to 36.4%. Cash and marketable securities increased by about $800 million to $28.9 billion.

Profits came from strong iPhone sales at 3.8 million units, an increase of 128% year-over-year, and increasing margins. Margins were lifted due to decreasing commodity prices of key component materials, sales of higher margin products including software from the Apps Store, and lower warranty and freight costs. Although Mac products and Services declined about 3%, this number compares favorably to the overall market decline estimated at 7% for the quarter by the IDC.

Apple resisted the recession and posted an increase in quarterly profits of 15%. With CEO Steve Jobs sitting this quarter out, the strong financial results helps to affirm the idea that Apple has a deep bench and will only benefit from Job's intended return this June. A sudden change in Job's condition would nonetheless create strong negative pressure on Apple's stock price and now may be a time to reevaluate Apple and possibly take our gains.