Bernstein Sounds Caution on Apple's Gross Margins
Analysts at Bernstein SocGen Group are sounding caution on Apple's upcoming financials, warning that rising memory costs could put pressure on the company's gross margins. In a research note released Friday, the firm reiterated its Outperform rating on Apple with a price target of $370.00.
The 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. Bernstein estimates that Apple's blended iPhone gross margin could be as low as 39.6% and its overall gross profit margin at 45.8%, both of which are below consensus.
These figures would imply a $2.87 earnings per share estimate for the quarter, which is 2% below consensus. Bernstein's analysis also notes that Apple's recent product release did not disappoint, but concerns remain about the impact of rising memory costs on gross margins.