Canaccord Genuity Cuts Est., PT on Apple (AAPL) on Softer iPad Sales and Mix, Lower iPhone Sales

December 17, 2012 8:48 AM EST
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Canaccord Genuity cuts estimates and its price target on Apple (NASDAQ: AAPL) from $800 to $750 due to softer iPad sales and mix, slightly lower iPhone sales. However, the Buy rating was maintained.

"While our November channel checks indicated very strong sales of the iPhone 5, we are slightly lowering our F2013 and F2014 iPhone and iPad estimates due to softer sales expectations in international markets, primarily in Europe," analyst T. Michael Walkley notes. "While order reductions to iPhone suppliers are not unusual this time of year, we believe reduced iPhone 5 orders for the March quarter could also indicate an earlier launch of new iPhone products in the June quarter. Despite our slightly lowered estimates, we believe Appleā€™s industry-leading software ecosystem and integrated hardware experience will result in a strong multi-year product cycle."

Walkley lowered F2013 iPhone unit sales estimate from 174M to 172M and F2014 iPhone unit sales estimate from 229M to 215M. They have lowered F2013 iPad unit sales estimate from 93M to 87M and F2014 estimate from 115M to 102M units.

Due to lowered iPhone and iPad unit estimates combined with a greater mix of lower-ASP iPad sales, the firm reduced F2013 pro forma EPS estimate from $53.15 to $51.95 and F2014 estimate from $61.50 to $58.11.

The new $750 price target is based on shares trading at roughly 13x the firm's F2014 EPS estimate.

For an analyst ratings summary and ratings history on Apple click here. For more ratings news on Apple click here.

Shares of Apple closed at $509.79 yesterday.

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