Look Who’s Doubting Apple Now

Looks like one of Apple’s (NASDAQ:AAPL) biggest bulls has begun rebalancing his expectations from the company. Brian White of Topeka Capital Markets announced in a note to investors on Thursday that he was cutting his 12-month price target on the company from a remarkably high $1,111 to $888 per share on the tumbling stock price.

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Apple dropped a little under 10 percent in after-hours trading on Wednesday after its earnings results were announced, saw a similar fall premarket on Thursday, and was down a little more than 10 percent in the first few minutes of the start of the trading day. “Given the decline in the share price, we are lowering our 12-month price target to $888 from $1,111 for Buy-rated Apple,” White wrote.

The company said on Wednesday that profit in the holiday quarter rose less than 1 percent to $13.1 billion, or $13.81 a share. It was the slowest earnings growth since 2003 for Apple. Sales rose 18 percent to $54.5 billion for their weakest increase in 14 quarters.

White added that Apple’s immediate decline has left the stock trading “at less than six-times (ex-cash) our calendar year 2014 EPS estimate and we believe there is quite a bit of bad news priced into the stock at current levels, while estimate resets lower the bar for the future.”

Rebalancing Expectations

The analyst cut his earnings estimates for the March quarter to $10 per share, well below Wall Street’s current $11.67 consensus, and also trimmed his full fiscal 2013 projections to $192.1 billion in revenue from a previous $191.9 billion and $47.73 in earnings per share from the earlier $49.04.

“For the [second fiscal quarter], Apple expects revenue of $41 billion to $43 billion (Street is at $45.38 billion) and inline with our $41.9 million projection,” White wrote. “Given our expectation of a shorter launch cycle for the iPhone and iPad, we recently adjusted the seasonality in our model and particularly for the March quarter, which jibes with the outlook that Apple provided last night. As such, we are maintaining our [second fiscal quarter] revenue estimate at $41.9 billion, while adjusting our EPS projection to $10.00 from $10.37 (Street is at $11.67).”

However, he added, profit and sales cycle ere likely to reach their bottoms in the second-quarter of fiscal 2013.

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