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)


3mo ending Jun19  Rev$B   GM%  $EPS
----------------  -----  ----  ----
Analysts consens   51.9     -  2.08
Apple gde lo (e)   51.0  38.0  2.12*
Apple gde hi (e)   53.0  38.5  2.30*
My estimates       52.5  38.3  2.26 (4.43b shares)

*EPS guidance ranges derived from other figures provided
 by Apple and diluted shares outstanding estimated by me


12m ending Sep19  Rev$B   $EPS
----------------  -----  -----
Analysts consens  255.0  11.38
My estimates      257.0  11.91


Valuation
Timeframe  NTMfrom   $EPS  Y/Y  Mult  Val  $*   Div  Tot
---------  -------  -----  ---  ----  ---  --  ----  ---
Trail Val  Apr2018  11.88  15%  11.0  131  20  2.92  154
 Fair Val  Apr2019  13.15  11%  12.0  158  12  3.24  173
1y Target  Apr2020  14.87  13%  12.9  192   6  3.64  202

*Cash per share balance net of debt and commercial paper




(click to enlarge)


Statements of Operations


Revenues  F2Q19e  F2Q18*   Y/Y%
--------  ------  ------  -----
iPhone    30,722  37,559  -18.2
Mac        5,846   5,776    1.2
iPad       4,455   4,008   11.1
W/H/A      5,260   3,944   33.4
--------  ------  ------  -----
Products  46,284  51,287   -9.8
Services  11,403   9,850   15.8
--------  ------  ------  -----
Tot Revs  57,687  61,137   -5.6


Gross Margin Breakdown (est)
--------  ------  ------  -----
Products  14,919  17,606  -15.3
Services   6,913   5,816   18.9
--------  ------  ------  -----
Tot GM    21,831  23,422*  -6.8
--------  ------  ------  -----
Prod GM%   32.2%   34.3%   -2.1
Svcs GM%   60.6%   59.0%    1.6
--------  ------  ------  -----
Tot GM%    37.8%   38.3%*  -0.5


Op Expns   8,534   7,528   13.4
--------  ------  ------  -----
OpIncome  13,297  15,894  -16.3
Op Mrgn%   23.1%   26.0%   -2.9

OIE          330     274   20.3
--------  ------  ------  -----
Pre-Tax   13,627  16,168  -15.7
Tax Rate   17.0%   14.5%    2.5
Tax Prov   2,317   2,346   -1.3

--------  ------  ------  -----
Net Incm  11,310  13,822  -18.2
Net Mrg%   19.6%   22.6%   -3.0

Dil Shrs   4,617   5,068   -8.9
--------  ------  ------  -----
EPS        $2.45   $2.73  -10.2

Amounts in millions except EPS in dollars and ratios in %
* actual as reported except Gross Margin Breakdown (est)