Apple Computer "neutral," estimates raised

06/21/04 - First Albany

NEW YORK, June 21 (New Ratings) — Analysts at First Albany issue a "neutral" rating on Apple Computer, Inc (AAPL), while raising their estimates for the company.

Shares of Apple Computer, a global provider of personal computers and related software and computing solutions, are currently trading at $32.91.

According to First Albany’s research note published this morning, Apple Computer is likely to witness re-accelerated momentum in iPod’s unit growth by the September quarter. The analysts mention that the company is poised for robust near term unit growth in its iPod Mini and iTunes products in the European market. Moreover, First Albany expects Apple Computer to benefit considerably from its summer launch of the HPod product in the forthcoming quarters.

The analysts anticipate relatively modest sequential growth in Apple Computer’s iPod shipments in the current quarter, primarily due to the persisting supply constraints associated with its iPod Mini product. First Albany expects the company to resolve these supply constraints by 4Q FY04. However, the current valuation of Apple Computer’s stock has limited upside potential, as compared to the company’s near-term earnings and revenue growth outlook, the analysts believe.

The EPS estimates for FY04 and FY05 have been raised from $0.61 to $0.65 and from $0.72 to $0.88, respectively. The P/E estimates for FY04 and FY05 are 50.6x and 37.4x, respectively.

First Albany issues a "neutral" rating on Apple Computer, Inc.