We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Apple (AAPL) to Report Q2 Earnings: Is a Beat in Store?
Read MoreHide Full Article
Apple, Inc. (AAPL - Free Report) is set to report its second-quarter fiscal 2017 results on May 2. Last quarter, it posted a 4.35% positive earnings surprise. The company has outperformed the Zacks Consensus Estimate in three of the last four quarters, with an average positive earnings surprise of 0.89%.
Let’s see how things are shaping up prior to the announcement.
Earnings Whispers
Our proven model shows that Apple is likely to beat earnings because it has the right combination of the two key ingredients. A stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen.
Zacks ESP: Apple currently has an Earnings ESP of +1.00%. This is because the Most Accurate estimate is $2.03 while the Zacks Consensus Estimate is pegged at $2.01. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Apple has a Zacks Rank #3. This combined with the company’s Earnings ESP of +1.00%, makes us confident in looking for an earnings beat this quarter.
We caution against stocks with a Zacks Rank #4 or 5 (Sell rated) going into the earnings announcement, especially when the company is seeing negative estimate revisions.
Apple’s revenues got a boost due to increase in iPhone demand caused by the launch of iPhone 7 and 7 Plus. Also, “Services” revenues, which include App store, Apple Music and Apple Pay have registered impressive growth. Investors will be more interested in the second half of the year. This is because Apple will be launching its mega edition, iPhone 8 around that time.
iPhone 8 is set to be launched to mark the tenth anniversary of the revolutionary iPhone. It is reported to have amazing features like a glass body, a dual-curved edge-to-edge OLED display with a built-in Touch ID sensor and wireless charging. iPhone 8 is already dubbed as a “super cycle”.
Meanwhile Apple remains focused on finding newer growth avenues. It is also working on developing technologies such as artificial intelligence (AI) and augmented reality/ virtual reality (AR/VR), which are fast emerging as lucrative business opportunities. The company’s interest in the autonomous car project is understandable as it is now being labeled as a big business opportunity. Apple also remains focused on increasing its market share in India.
Over the past one year, shares of Apple have registered growth of 53.39% compared with the Zacks categorized Computer Mini industry’s gain of 52.18%.
Despite these, Apple continues to face a plethora of challenges. Competition from local players has been hindering iPhone growth in China. In the last reported quarter, Owing to persistent macroeconomic weakness, Apple revenues declined around 12% year over year in the Greater China region to $16.2 billion.
For the second quarter of fiscal 2017, Apple forecasts revenues in a range of $51.5–$53.5 billion. Gross margin is expected within 38–39%, while operating expenses are projected within $6.5–$6.6 billion.
Stocks to Consider
Here are a couple of stocks worth considering that, as per our model, have the right combination of elements to post an earnings beat this quarter:
Exelixis, Inc.(EXEL - Free Report) has an Earnings ESP of +100.00% and a Zacks Rank #3.
GoDaddy Inc. (GDDY - Free Report) with an Earnings ESP of +125.00% and a Zacks Rank #3
Zacks' Hidden Trades
While we share many recommendations and ideas with the public, certain moves are hidden from everyone but selected members of our portfolio services. Would you like to peek behind the curtain today and view them?
Starting now, for the next month, I invite you to follow all Zacks' private buys and sells in real time from value to momentum...from stocks under $10 to ETF to option movers...from insider trades to companies that are about to report positive earnings surprises (we've called them with 80%+ accuracy). You can even look inside portfolios so exclusive that they are normally closed to new investors. Click here for Zacks' secret trade>>
Unique Zacks Analysis of Your Chosen Ticker
Pick one free report - opportunity may be withdrawn at any time
Image: Bigstock
Apple (AAPL) to Report Q2 Earnings: Is a Beat in Store?
Apple, Inc. (AAPL - Free Report) is set to report its second-quarter fiscal 2017 results on May 2. Last quarter, it posted a 4.35% positive earnings surprise. The company has outperformed the Zacks Consensus Estimate in three of the last four quarters, with an average positive earnings surprise of 0.89%.
Let’s see how things are shaping up prior to the announcement.
Earnings Whispers
Our proven model shows that Apple is likely to beat earnings because it has the right combination of the two key ingredients. A stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen.
Zacks ESP: Apple currently has an Earnings ESP of +1.00%. This is because the Most Accurate estimate is $2.03 while the Zacks Consensus Estimate is pegged at $2.01. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Apple has a Zacks Rank #3. This combined with the company’s Earnings ESP of +1.00%, makes us confident in looking for an earnings beat this quarter.
We caution against stocks with a Zacks Rank #4 or 5 (Sell rated) going into the earnings announcement, especially when the company is seeing negative estimate revisions.
Apple Inc. Price and EPS Surprise
Apple Inc. Price and EPS Surprise | Apple Inc. Quote
Factors to Consider
Apple’s revenues got a boost due to increase in iPhone demand caused by the launch of iPhone 7 and 7 Plus. Also, “Services” revenues, which include App store, Apple Music and Apple Pay have registered impressive growth. Investors will be more interested in the second half of the year. This is because Apple will be launching its mega edition, iPhone 8 around that time.
iPhone 8 is set to be launched to mark the tenth anniversary of the revolutionary iPhone. It is reported to have amazing features like a glass body, a dual-curved edge-to-edge OLED display with a built-in Touch ID sensor and wireless charging. iPhone 8 is already dubbed as a “super cycle”.
Meanwhile Apple remains focused on finding newer growth avenues. It is also working on developing technologies such as artificial intelligence (AI) and augmented reality/ virtual reality (AR/VR), which are fast emerging as lucrative business opportunities. The company’s interest in the autonomous car project is understandable as it is now being labeled as a big business opportunity. Apple also remains focused on increasing its market share in India.
Over the past one year, shares of Apple have registered growth of 53.39% compared with the Zacks categorized Computer Mini industry’s gain of 52.18%.
Despite these, Apple continues to face a plethora of challenges. Competition from local players has been hindering iPhone growth in China. In the last reported quarter, Owing to persistent macroeconomic weakness, Apple revenues declined around 12% year over year in the Greater China region to $16.2 billion.
For the second quarter of fiscal 2017, Apple forecasts revenues in a range of $51.5–$53.5 billion. Gross margin is expected within 38–39%, while operating expenses are projected within $6.5–$6.6 billion.
Stocks to Consider
Here are a couple of stocks worth considering that, as per our model, have the right combination of elements to post an earnings beat this quarter:
AMTEK Inc. (AME - Free Report) has an Earnings ESP of +1.79% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
Exelixis, Inc.(EXEL - Free Report) has an Earnings ESP of +100.00% and a Zacks Rank #3.
GoDaddy Inc. (GDDY - Free Report) with an Earnings ESP of +125.00% and a Zacks Rank #3
Zacks' Hidden Trades
While we share many recommendations and ideas with the public, certain moves are hidden from everyone but selected members of our portfolio services. Would you like to peek behind the curtain today and view them?
Starting now, for the next month, I invite you to follow all Zacks' private buys and sells in real time from value to momentum...from stocks under $10 to ETF to option movers...from insider trades to companies that are about to report positive earnings surprises (we've called them with 80%+ accuracy). You can even look inside portfolios so exclusive that they are normally closed to new investors. Click here for Zacks' secret trade>>