BMO Capital Markets analyst Keith Bachman raised his price target and earnings estimates on Apple arguing that margins are likely to be better than feared. Bachman raised his price target to $450 from $435, and increased his fiscal 2014 earnings estimates to $42.08 per share. the BMO analyst expects Apple to earn $44.84 a share in fiscal 2015, and rates the stock a "market perform."
"We believe that the long-term trends of greater competition will pressure Apple's growth and/or margins in handsets," Bachman wrote in a note. "However, near term, we think gross margins will increase q/q, helped by the fact that Apple took a material warranty charge in the March quarter, which negatively impacted margins by almost 100 basis points. We would expect the stock to positively respond to favorable margin variance near term."
Apple shares were sharply lower in early Monday trading, off 2.8% to $401.92.--Written by Chris Ciaccia in New York >Contact by Email. Follow @Chris_Ciaccia
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