Apple Inc (AAPL)

[Bootz]

BMO Ups Target To $465 On Higher iPhone Estimates

by Tiernan Ray

BMO Capital Markets’s Keith Bachman this morning reiterates an Outperform rating on Apple’s (AAPL) shares, while raising his price target to $465 from $450, on higher estimates for Apple’s sales of the iPhone.

Bachman expects “continued strength” for Apple in smartphones, with more carrier relationships and share gains in CDMA phones, in particular with Verizon Communications (VZ) this fall, once the next version comes out of the iPhone, which he dubs the “iPhone 4S.”

Citing the work of his colleague, handset analyst Tim Long, Bachman notes that Apple should increase its iPhone sales this year by 1.5 times the rate of growth of the smartphone market because it is still signing up new carrier partners.

However, Apple’s iPhone’s growth may trail the smartphone market’s growth next year as some sales may slow in advance of what he expects to be the introduction of an “LTE” iPhone in the latter part of the year.

Bachman raised his iPhone unit forecast for this quarter to 19.5 million from 18 million, a 4% decline from last quarter’s 20.3 million units.

He also cut his Mac and iPod assumptions, as he now sees a slower-than-expected back-to-school selling season. Bachman left intact his forecast for 10.5 million iPads to be sold.

That brings Bachman’s financial estimate for the quarter to $28.9 billion in revenue from a prior $27.5 billion, and to $7.07 per share in profit from a prior $6.45.

For fiscal 2012, he sees Apple selling 98.9 million iPhone units, up from a prior 92.5 million forecast. He also raised his iPad estimate to 54.5 million from 52.2 million.

Hence, he now models Apple making $136 billion in revenue next year and $32.90 per share in profit, up from $131.6 billion and $31.15 per share.

http://blogs.barrons.com/techtraderdaily/2011/08/02/apple-bmo-ups-target-to-365-on-higher-iphone-estimates/?mod=yahoobarrons