Topeka's Brian White Cuts Legendary Apple (AAPL) Price Target
White commented, "Last night, Apple reported 1QFY13 results and offered up a 2QFY13 sales outlook that was inline with our model but fell short of the Street's estimates, while margins are expected to be below our projections. As such, we are slightly tweaking our sales estimate higher but taking a modest haircut to our EPS projection. With Apple down 10% in after market trading, the stock is trading at less than 6x (ex-cash) our CY14 EPS estimate and we believe there is quite a bit of bad news priced into the stock at current levels, while estimate resets lower the bar for the future. At the same time, we believe the profit and sales cycle will reach the bottom in 2QFY13."
The firm maintained 2QFY13 revenue estimate at $41.9 billion, while adjusting EPS projection to $10.00 from $10.37 (Street is at $11.67). For FY13, they are slightly increasing revenue estimate to $192.1 billion from $191.9 billion, while trimming EPS projection to $47.73 from $49.04.
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Shares of Apple closed at $514.01 yesterday, with a 52 week range of $419.55-$705.07.