Tuesday, July 16, 2019

Fiscal 3Q 2019 Final Estimates


As of today's close of $204.50, AAPL is trading at a 15.5x multiple on my next-twelve-months EPS estimate (14.0x when excluding NTM net cash and dividends).

Don't get fooled by the most boring quarters, like, ever. Another consecutive "no collapse" quarter is good, means last Q1 adjustments worked. Not sure why WS sees 3% rev decline in Sep after flat or slight growth in June, in any case, strong Q4 guidance may surprise (but no earns growth until Q1).

Emphasis on intriguing longer-term themes is great. Key behind-the-scenes platform and business model shifts, happening almost in slow-motion, into new services and broader ecosystem relationships eventually will have huge effects on long-term fundamentals, but ironically will be hard to notice for some time and confound most pundits.

Also hard to explain, so I'll leave it at that.


Detailed estimates:


3mo ending Jun19  Rev$B   GM%  $EPS
----------------  -----  ----  ----
Analysts consens   53.4     -  2.10
Apple guide low    52.5  37.0  2.00*
Apple guide high   54.5  38.0  2.21*
My estimates       53.8  37.8  2.15 (4.59b shares)

Monday, April 22, 2019

Fiscal 2Q 2019 Final Estimates


As of Friday's close of $203.86, AAPL is trading at a 15.5x multiple on my next-twelve-months EPS estimate (14.3x when excluding NTM net cash and dividends).


Highlights:

iPhone rev -15%/+2% annual growth in FY 19/20, low single digits thereafter.
Non-iPhone rev +16%/+10% annual growth in FY 19/20, high single digits thereafter.
Total rev -3%/+5% annual growth in FY 19/20, mid single digits thereafter.
Net income -9%/+7% annual growth in FY 19/20, mid single digits thereafter.
Quarterly dividend raised to 81/91 cents (+11%/+12%) in April 19/20.
Buybacks of $49b/$21b for FQ2/FQ3 ($63b authorized up to last Q).
$75b buyback authorization expansion, $80b buyback over 1y ending March 2020.
$65b buyback 1y ending March 2021, approximately $50b/y thereafter.


Detailed estimates:


3mo ending Mar19  Rev$B   GM%  $EPS
----------------  -----  ----  ----
Analysts consens   57.4     -  2.36
Apple guide low    55.0  37.0  2.18*
Apple guide high   59.0  38.0  2.54*
My estimates       57.7  37.8  2.45 (4.62b shares)

Tuesday, January 15, 2019

Fiscal 1Q 2019 Final Estimates


As of yesterday's close of $150.00, AAPL is trading at a 11.6x multiple on my next-twelve-months EPS estimate (10.4x when excluding next-12-months net cash and dividends).


Projection highlights:

- iPhone revenue growth -10%/+3% in FY 19/20 (cf. -12% in FY16)
- Non-iPhone revenue growth +15%/+9% in FY 19/20
- Overall revenue growth -1%/5% in FY 19/20, mid-low single digits thereafter
- Net income growth -2%/4% in FY 19/20, low single digits thereafter
- Next report raises quarterly dividend to 81/92 cents in 19/20 (+11%/+14%)
- Buybacks of $8b/$60b for Q4/Q1 ($71b remained authorized as of Sep 2018)
- Expand authorization by $75b until March 2020, $65b until 2021, and ~$50b/y thereafter

Analysts are modeling insufficient buybacks, or don't believe in net cash zero promises from management, or still hope for big M/A. Implies ~8% upside to consensus EPS estimates.

My prior forward valuation multiple expansion of 0.25x per quarter will gradually taper starting after current quarter from 12x to 13.5x by 2022. Should be aiming at 15x but need to accomodate market sentiment in order to model future share reduction more accurately.


Detailed estimates:

3mo ending Dec18  Rev$B   GM%  $EPS
----------------  -----  ----  ----
Analysts consens   84.3     -  4.19
Apple guid revis   84.0  38.0  4.16*
My estimates       84.1  38.0  4.17 (4.77b shares)