Apple is set to report its fiscal third quarter financial results on Monday, July 21, after the close. So the question stands at not only what they will report, but how Wall Street will react and whether it is wise to buy ahead of earnings.
In terms of numbers, Thompson Financial’s analysts are expecting Apple to report net income of $972.6 million, or $1.08 per share, on sales of $7.4 billion. That’s an 18.9% profit growth and a 37% sales growth.
Forbes reports that a strong quarter is in the bag. Overall sales have proved fruitful as Mac has nabbed up third place in the U.S. PC market, due to a 38.1% increase in year-over-year. While investors may not be as interested in iPhone sales, as the 3G has been released in Q4 and is expected to be the major driver of iPhone sales in the future. Investors may also worried that the iPhone 3G will cut into iPod sales.
Additionally, gross margins were a bit disappointing last quarter and now Apple has further cut the price of the iPhone 3G. So it will be interesting to see how this will affect margins.
“The more important figures to watch will be guidance, with investors betting that Apple will report $8.3 billion in sales in the third quarter. However, Apple stores in the U.S. have run short of iPhones, raising questions about whether the company will be able to take advantage of strong demand for the product.”
“Investors could choose to react to specific statements or numbers initially, but I trust most will come to their senses in time. The question is when. Apple stock was down over 2% by midday to $168 today, undoubtedly enticing some to snap up shares at this price. Even though with the iPhone and Mac, as well as continued strong iPod sales, Apple is a long-term buy.” via BloggingStocks. Given this information it may be wise to be weary of jumping in ahead of earnings.
