Shares of tech giant Apple are up over 1% in early morning trading reaching as high at $580 - helped by a bullish report from analyst Glen Yeung of Citigroup as reported this morning by Forbes writer Eric Savitz. Likewise, early sales indicators from the Black Friday weekend points to another monster quarter for Apple. Many analysts point to the fact that Apple had not had to offer significant discounts of its iPad mini as a sign of strong demand.
Ahead of the shopping season, analysts had initially projected iPad mini sales to reach an estimated 5 million units. However, with the device commanding such interest from retailers such as Walmart and Best Buy, it is not out of the realm of possibility that Apple might exceed that total before Christmas on its way to at least 6.5 million units.
This would be more than enough to help the company exceed its initial EPS and revenue guidance of $11.75 and $52 billion respectively for the report due in January. Although these numbers disappointed investors, the company is notorious for under-projecting to over-deliver. What this means is that when it is all said and done, Apple might once again reclaim its lead as the mobile device king even though Microsoft’s Surface tablet as well as Google’s Nexus 7 have entered the market.
From an investment perspective, it’s hard not to like the stock at any price under $600. The stock has rebounded nicely after dropping as much as 30% a recent to low of $505. The decline was largely due to concerns over the “fiscal cliff.” However, shares seem poised to regain the $600 mark.
The only question is how soon will it happen and where will it go from there? With shares reaching $580, this puts the stock just a tad over 3% away from that all-important psychological benchmark. Whether it happens this week or not remains to be seen, but the long term story of Apple has not changed and investors are beginning to see how irrational of a correction it just experienced.
