toggle

AAPL Stock: 119 ( + 1.4 )

Printed from http://www.macnn.com

Apple 'growth story' expected to survive recession

updated 11:55 am EST, Tue November 25, 2008

Kaufman on Apple prospects

Apple is likely to continue growth in spite of a looming recession, says Kaufman Brothers' Shaw Wu. Formerly with American Technology Research, the analyst notes that Kaufman is starting its coverage of Apple by posting a "buy" rating and suggesting a 12-month price target of $120. This was calculated using a 15x multiplier on its CY09 FCF estimate, which is $7.89.

Wu notes that while his new firm is worried about the current economic crisis, which is global and turning into a recession in many regions, Apple is still in a position to continue growing its share of the marketplace. This is attributed to several products, namely the new aluminum MacBooks, the iPhone 3G, the fourth-gen iPod nano and the newly cheaper second-gen iPod touch.

Worldwide, Macs are said to represent only 3 percent of the market, despite year-over-year growth of 30 to 50 percent during the last two years. Wu suggests, as a result, that marketshare could double within the next two or three years. Apple finances could be further aided by the iPhone, which already holds 1 percent of the cellphone market.

Looking to future revenue, the Kaufman firm is predicting $35.5 billion for FY09 and $42.8 billion for FY10, with EPS results of $5.05 and $6.45, respectively. This has been deliberately pegged below consensus estimates, says Wu, as a reflection of the impact of the global economy, which Kaufman hopes will recover to a degree by the second half of 2009. The group observes that the situation could improve more rapidly, in which case its estimates would be too conservative.




by MacNN Staff

POST TOOLS:

TAGS :

toggle

Comments

Login Here

Not a member of the MacNN forums? Register now for free.

toggle

Network Headlines

toggle

Most Popular

MacNN Sponsor

Recent Reviews

IDrive cloud backup and sync service

There are a lot of cloud services out there, and nearly all of them can be used for backing up key files and folders. A few dedicated ...

Plantronics BackBeat Pro Bluetooth headphones

Looking for a pair of headphones that can do everything a user requires is a task that can take some study. Trying to decide on in-ear ...

MaxUpgrades 512GB Retina MacBook Pro SSD

Apple's Retina line of MacBook Pro notebooks have been impressive, right from their debut in 2012. Thinner than the previous model, t ...

toggle

Most Commented