Bernstein Reiterates 'Outperform' on Apple Amid Memory Cost Pressures

Bernstein's SocGen Group has reaffirmed its 'Outperform' rating on Apple Inc. () with a price target of $370.00, citing potential pressure on gross margins from rising memory costs.

The firm's analysis points to downside risk for Apple's gross margin and earnings per share in the December quarter, though stronger international pricing provides some offset.

Using U.S. market prices, Bernstein's preliminary analysis implies a 39.6% blended iPhone gross margin and 45.8% Apple gross margin. In comparison, Apple reported a 48.7% gross profit margin over the last twelve months, making these estimates notably lower.

After incorporating stronger international price increases, the global pricing analysis supports a 40.4% iPhone gross margin, which is 390 basis points below consensus. The firm's analysis also points to a 46.2% Apple gross margin, 50 bps below consensus.