What to Expect When Apple Reports After the Close

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Apple Inc. (NASDAQ: AAPL) is set to report its most recent quarterly results after the markets close on Thursday. This may be one of the most highly anticipated earnings reports of the season, as investors get to see if the iPhone 8 and X measured up to the hype.

The consensus estimates from Thomson Reuters call for $3.86 in earnings per share (EPS) and $87.28 billion in revenue. The fiscal first quarter of last year reportedly had EPS of $3.36 and $78.35 billion in revenue.

Earlier this week, Japan’s Nikkei news site reported that disappointing sales of the iPhone X had led Apple to cut its production target for the next three months by 50%, from 40 million to 20 million units. Nikkei said the cut was due to “slower-than-expected sales in the year-end holiday shopping season in key markets such as Europe, the U.S. and China.”

On the other hand, the independent technology analyst firm Canalys reported that Apple shipped 29 million units of its top-of-the-line iPhone X in the fourth calendar quarter of 2017. That was enough to make the new device the top smartphone model during the 2017 holiday season.

While we may be getting these mixed reports, Apple earnings will have its newest iPhone clearly in the spotlight.

Also, the company outlined how it will “support the American economy and its workforce” over the next five years. Based on what Apple is currently spending with domestic suppliers, the company said it expects its direct contribution to the U.S. economy to exceed $350 billion over five years.

That massive total does not include Apple’s own tax payments, taxes generated from employee pay, or the sale of Apple products. The $38 billion Apple expects to pay to repatriate the $250 billion the company currently holds offshore is not included in the $350 billion total.

At the same time, it will invest more than $30 in capital spending and create more than 20,000 U.S. jobs over the next five years. Apple currently employs 84,000 Americans in all 50 states.

Despite the massive move upward in January, Apple stayed relatively still, with its stock down about 1% year to date. However, over the past 52 weeks the stock is actually up closer to 38%.

Prior to the release of the earnings report a few analysts weighed in on the stock:

  • Loop Capital has a Buy rating with a $195 price target.
  • Merrill Lynch has a Buy rating with a $220 target.
  • HSBC has a Buy rating and a $204 price target.
  • Deutsche Bank’s Neutral rating comes with a $152 target.
  • Oppenheimer has a Hold rating.
  • Morgan Stanley has an Overweight rating and a $200 target.
  • Canaccord Genuity has a Buy rating with a $200 price target.
  • Barclays has a Neutral rating with a $174 price target.

Shares of Apple traded at $167.06 early Thursday, with a consensus analyst price target of $189.78 and a 52-week range of $127.78 to $180.10.