CHICAGO, July 20, 2011 /PRNewswire/ -- Zacks.com announces
the list of stocks featured in the Analyst Blog. Every day the
Zacks Equity Research analysts discuss the latest news and events
impacting stocks and the financial markets. Stocks recently
featured in the blog include: Apple (Nasdaq: AAPL), China
Unicom (NYSE: CHU), Research In Motion Limited (Nasdaq:
RIMM), China Mobile (NYSE: CHL) and China Telecom
Corp. (NYSE: CHA).
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Here are highlights from Tuesday's Analyst Blog:
Apple Kills It... Again
Magic-maker and "serial earnings surpriser" Apple
(Nasdaq: AAPL) blew away everybody -- even the most optimistic
investors -- with 35% beat of estimates this afternoon. The company
reported EPS of $7.79 when the
consensus estimate was for only $5.81.
To give you an idea of how big this beat was, the highest
published estimate by any analyst was $6.58. Even the "whisper" numbers all day were
only as high as $7.34 at the extreme
upper end. And this after weeks of dozens of analysts raising their
estimates for the quarter and the year.
Apple revenues came in at $28.57
billion when the street was looking for something closer to
$25 billion. This sales growth was
driven by strong numbers for the iPhone which exceed 20 million
units and the iPad which topped 9 million. Word is that they sold
every iPad they could make.
The record quarterly revenue was matched by record quarterly net
profit of $7.31 billion, versus year
ago revenues of $15.70 billion and
net quarterly profit of $3.25
billion, or $3.51 per diluted
share. This represents a 122% jump in profits.
According to the company's press release, gross margin was 41.7
percent compared to 39.1 percent in the year-ago quarter and
international sales accounted for 62 percent of the quarter's
revenue. They sold 20.34 million iPhones, representing 142 percent
unit growth over the year-ago quarter and 9.25 million iPads was a
183 percent unit increase.
Apple also sold 3.95 million Macs, a 14 percent unit increase
over the year-ago quarter and even 7.54 million iPods, a 20 percent
unit decline.
"We're thrilled to deliver our best quarter ever, with revenue
up 82 percent and profits up 125 percent," said Steve Jobs, Apple's CEO. "Right now, we're very
focused and excited about bringing iOS 5 and iCloud to our users
this fall."
Apple now has $76 billion in cash
and must be leaving analysts wondering what their next move is with
that kind of war chest.
China Unicom Adds 3G Subscribers
China's second largest mobile
operator China Unicom (NYSE: CHU) added 2.28 million
subscribers in June, up 1.27% from the prior month. This takes the
company's total customer base to 181.62 million.
The company's GSM subscriber base rose to 157.67 million with
the net addition of 0.42 million customers, while its 3G subscriber
base increased to 23.95 million with net addition of 1.86 million
in June. China Unicom added more 3G subscribers in June compared to
1.74 million 3G subscribers in the last month. With the growth in
subscribers, the company appears on track to reach its 25 million
target for fiscal 2011.
The company's 3G business is performing well and the momentum is
expected to continue well into the future. 3G remains a compelling
opportunity and represents the single biggest driver of the
company's long-term growth. For the full year, capital spending on
3G network is estimated at RMB 73.80
billion.
We believe China Unicom will continue to make significant
progress in expanding economies of scale in 3G, broadband and other
businesses that will likely improve its overall revenue and
profitability. The company is offering 3G services in collaboration
with Research In Motion Limited's (Nasdaq: RIMM) Blackberry
phones. Additionally, the company has the exclusive right to
distribute Apple Inc.'s (Nasdaq: AAPL) iPhone in
China. China Unicom is also
in talks with Apple to sell the iPad by the end of 2011.
China Unicom's 3G and fixed-line broadband businesses have been
ramping up since last year. However, these businesses are expected
to remain under pressure due to increasing depreciation and
amortization expenses; networks, operations and support expenses;
as well as selling expenses for the remainder of this year. We
believe these expenses will have an adverse effect on the company's
future profitability, free cash flow and margins.
Further, higher handset subsidies and increased costs related to
3G service deployments will continue to be headwinds for the
company. Despite these challenges, we expect China Unicom to
benefit from new users this year.
China Unicom is offering handsets at subsidized rates with lower
3G service plans for multi-year contracts to retain existing
customers and add new ones. This will weigh on the company's future
overall average revenue per user. Moreover, China Unicom remains
significantly challenged by aggressive nationwide 3G service
rollouts by its peers China Mobile (NYSE:CHL) and China
Telecom Corp. (NYSE: CHA).
We currently have a long-term Neutral rating on China Unicom.
The stock retains a Zacks # 3 (Hold) Rank for the short term (1–3
months).
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