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April 24, 2008

Apple: After Earnings, Before The Call

Here is the series of posts I made on RealMoney.com yesterday after crunching Apple's numbers but before the conference call Q&A started:

4:49 PM EST: Good and and I like the guidance being in line with consensus. Tax rate was low adding 4 cents to EPS. That probably is why the stock has pulled back. iPhone at 1.7 million is on th low end. Gross margins did not surprise to the upside so operating margins not as good as hoped but top line offset thanks to Macs. iPod units fine but ASPs not up that big so it was probably the shuffle price cut. More later but I'd say this is a win for the bulls because it takes away potential form the bears. I wouldn't expect a huge response form the stock in either direction unless the conference call surprises. In the near-term, this stock is not going back to $120 but it isn't going to see $200 either.

5:08 PM EST: Stock now down a bit. Guidance on revenues is inline. EPS guidance is $1.00 vs. consensus of $1.10. Consensus was looking for 3% sequential revenue growth in June but guidance is for -4%. That of course is only a problem because 2Q revs were well ahead of expectations. My spreadsheet suggests June quarter guidance is conservative unless management is expecting a major step down in yoy notebook sales growth rate. That is doubtful given momentum, market share gains, and past sequential performance.

I suppose the lack of a blowout in the March quarter may have caused some consternation. I stand by my first impression: very solid quarter and guidance with little for the bears but not enough for the bulls in the short-term. I plan to hold my shares and will add in new accounts at current prices now that the quarter is out of the way.

5:33 PM EST: I should have noted this in prior quarters but Apple's press release is only 238 words. I challenge subscribers and contributors to find a similarly short press release from such a meaningful company or any company. And my editors (and readers) can just ignore the jokes about my word counts!!!!

Posted by Steve Birenberg at April 24, 2008 03:31 PM in AAPL