Tuesday, January 22, 2008

Apple reports record results, gets re-priced on forecast.

(From MarketWatch)
After the closing bell today, Apple reported a first-quarter profit of $1.58 billion, or $1.76 a share, on revenue of $9.6 billion. During the same period a year ago, Apple earned $1 billion, or $1.14 a share, on $7.12 billion in sales. Analysts surveyed by Thomson Financial had forecast Apple to earn $1.62 a share on revenue of $9.47 billion. Apple said that during the quarter ended Dec. 31 it sold 22.1 million iPods and 2.3 million Macintosh PCs. For its second quarter, the company estimates it will earn 94 cents a share on $6.8 billion in revenue

This soft forecast caused an immediate sell-off as the company's shares were re-priced by the market, currently trading after-hours at $139.33, down from a 52-week high of $202.96.

While Apple is notorious for its sandbagging of Wall Street when it comes to forecasts, I'd suspect that this time they're actually owning up to lowered expectations of a softening economy.

So we got the blowout quarter, which saves me from having to eat my dongle, but the forecast going forward suggests that I might want to start eating cat food on alternate Wednesdays. Oh bother!

This sell-off is a great buying opportunity for anybody wanting to get in.

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