Apple will report first quarter earnings after the market close today.

Apple has become a battleground stock.  Earnings will provide lots of data but will not settle the debate about Apple’s future.  The obvious question is, “What should investors do with the onslaught of data related to all things Apple?”

The single most important data point to focus on is the number of iPhone sales.  The consensus is 48 million.  Most estimates range from 45 million to 50 million.  The latest negative sentiment is bringing down the whisper numbers for iPhone sales.  Some whisper numbers are in the range of 43 to 45 million.

Whisper numbers are one of Wall Street’s best kept secrets.  Whisper numbers are usually made available only to the most favored clients.   Astute investors know that stocks move based on the difference between actual reported numbers and whisper numbers.  Investors focusing on published numbers are often left holding the bag.

The reason the iPhone number is so important is because iPhone contributes about 70% of Apple’s profits.  Institutional investors are likely to focus on this number.  Also this number is beyond reproach and does not involve reading tea leaves.

The consensus is that Apple will earn $12.8 billion on about $55 billion in sales.  In the past, guidance of future earnings provided by Apple has not helped investors.  The reason is that analysts have traditionally dismissed Apple’s forecasts as sandbagging and have come up with their own projections...Read more at Forbes

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