Shares of Apple (AAPL) are up $5.55, or 1.3%, at $419 in early trading as the positive notes continue to flow in — more of the “Apple Sweepstakes,” perhaps, as David Rolfe called it yesterday.
Spicing things up this morning, AllThingsD’s John Paczkowski reports that Apple’s media event to unveil the next iPhone will take place on October 4th, citing multiple anonymous sources, supporting his prior claim of an introduction that month.
In response, Ticonderoga Securities’ Brian White this morning that “This will clearly be a crucial event for Apple with Tim Cook in control as CEO for the first time ever for a new product launch.”
White opines there will be “less lag time after the media event versus iPhone 4 given the later than typical unveiling” of the device.
“At the same time, we believe the international ramp will be faster versus the iPhone 4 and the carrier base is now larger at 228 relationships as of July, while we expect China will play a more important role this time around.”
White reiterates a Buy rating and a $666 price target. And in a separate note this morning, White waxed enthusiastic about Apple’s prospects in China:
The big opportunity for Apple is the transition of this nearly 1 billion [927 million] wireless subscriber base to 3G (and eventually 4G) subscribers in the coming years with the ramp of China’s mobile Internet. In the near-term, we expect Apple’s iPhone ramp to finally extend beyond China Unicom to China Telecom and potentially China Mobile this year. Over the summer, we indicated that it made sense for Apple to introduce two types of iPhones with China Telecom that included the iPhone 5 and a “Simplified iPhone 4″, as was highlighted by Sohu.com. Also, similar to the iPad 2 rollout, we believe Apple will expand overseas at a much faster clip with the iPhone 5, including China.
Also this morning, Goldman Sach’s Bill Shope, for example, today raised his price target on Apple to $520 from $480, while reiterating a “Conviction List” Buy rating on the shares, after observing that the current global macroeconomic malaise is having little impact on Apple’s business.
“Apple�s momentum appears even more resistant to macroeconomic pressures than we previously realized,” writes Shope, “and we believe the stock has significant upside from current levels � even after recent outperformance.”
Shope is keeping in place his iPhone unit estimate for this quarter at 16.92 million units, but raising his iPad unit estimate to 13.05 million units from a prior 12.7 million, and to 42.4 million from 42 million for the entire calendar year.
Shope did raise his December-quarter iPhone estimate, to 26.8 million units from a prior 26.3 million units. That would make 82.7 million iPhones this entire calendar year, up from 82.2 million estimated previously.
Shope raised his revenue estimate for the fiscal Q4 ending this month to $28.71 billion from $27.37 billion previously, and raised his EPS estimate to $7.30 from $6.49.
Similarly, late last night, BMO Capital’s Keith Bachman reiterated an Outperform rating on Apple shares, and reiterated a forecast for as many as 22 million iPhone units this quarter.
Bachman thinks Apple will not do away with the “3GS” iPhone model next quarter, but instead have a multi-tier structure in the market:
We think Apple will move to a three iPhone product family: a) the new phone will be the high end (either named the 5G or 4GS), b) the current 4G will be the midrange phone, and c) the 3GS will remain the low-end phone. As part of the launch, we think Apple could also introduce an 8GB iPhone 4G, for presumably a lower price point compared to the existing 16GB and 32GB iPhone 4G. However, we think volumes for the 3GS phones will be higher than the new 8GB 4G phone, and the vast majority of shipments for 4G phones will be for 16GB and 32GB phones, not 8GB. We think the iPhone 3GS could be a few million units in the Dec Q, compared to our total iPhone estimate of 25.5 million. In other words, we do not think an 8GB iPhone 4G creates a meaningful new product category in the iPhone family, for either the domestic or�international markets.
Also yesterday, Credit Suisse’s Kulbinder Garcha reiterated an Outperform rating and a $500 price target.
Garcha writes that he performed a “detailed analysis” of various developing world markets for Apple wares. He concludes Apple “is only at the cusp of unleashing its vast emerging market potential” and that developing economies could add “an staggering [sic] extra $68 billion in sales and $18 in EPS in 2015.”
Emerging middle classes could add $70 billion in sales and $17.50 in EPS. In 2011, we estimate that the average middle class American will spend $321 per year on Apple products, which will rise to $481 by 2015. Importantly, by 2015, there will be 244mn consumers in EMs with similar income profiles, up from 133mn this year. Assuming Apple addresses these markets, this drives an incremental $70bn in sales by 2015 (+57% from global revenue levels in CY11) and $17.50 in EPS (+56% increase). We estimate five countries will account for 63% of this potential � China, India, Brazil, Mexico and Russia, and with the upside being so focused, we believe that costs could also be manageable.
Barclays Capital’s Ben Reitzes yesterday said his own tour through Asia-Pacific last week confirmed for him Apple’s dominance in the region.
His meetings with companies in Hong Kong, Taiwan, Korea and Tokyo included “very optimistic” remarks from industry execs “about the potential for smartphones (iPhone/Apple more than other brands) and the prospects for tablets (iPad/Apple much more than any others).”
“The clear takeaway is that Apple has positive momentum into the holidays with a major new iPhone product cycle along with share gains in PC’s with Macs and iPads,” he concludes.
Reitzes has an Overweight rating on Apple and a $515 price target.
Wedge Partners’s Brian Blair also chimed in today about the forthcoming iPhone introduction. He sees Apple unveiling just one new model, very similar in look and feel to the current iPhone 4. He thinks a “4S” iteration of the iPhone 4 wouldn’t make sense:
We don�t expect a second, dramatically different iPhone to accompany this as we don�t think Apple needs to have 3 models in the market to address the high end, mid-tier and low end since the iPhone 4 (with memory lowered to 8 GB) will drop to $99 and effectively attack those markets.�Additionally, why would Apple bump up only the processor specs of the iPhone 4 in addition to a newly designed iPhone 5 if the goal is to sell it into the pre-paid market at a lower cost? A 4S would simply cost more and a 4S itself wouldn�t create a mid-tier market unless it was priced at $99 and the iPhone 4 went to $49 with the new iPhone at $199. We see this scenario as unlikely. The idea of the new phone being called �4S� with the same casing as the 4 actually makes sense however as that would follow the path of the 3G to 3GS transition, but we don�t believe Apple would release a 4S along with a 5. It�s one or the other in our view. And whatever Apple calls it, we are referring to it as iPhone 5 for now.
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