NEW YORK (TheStreet) -- Shares of Apple (AAPL) - Get Report are soaring 6.58% to $103.03 on heavy trading volume late Wednesday morning after the iPhone maker beat analysts' estimates for earnings and revenue in the second quarter.
Apple similarly beat analysts' estimates for amount of units sold, though the number dropped to 40.4 million in the most recent period from 47.5 million a year ago.
Analysts looked to Apple suppliers such as Skyworks (SWKS), Broadcom (AVGO) and Qorvo (QRVO), and concluded that Apple was stuck with excess inventory because it hadn't placed many chip orders, TheStreet's Jim Cramer noted on CNBC's "Squawk on the Street" this morning.
But Apple actually didn't build enough inventory and sold through its less expensive iPhone to continue to make a lot of money, Cramer added.
"The bottom line here is that the analysts thought there was going to be a lot of price cutting because Apple couldn't sell its phones," he said. "Apple sold through rather well."
Cramer mentioned that he could make the case that estimates have bottomed on Apple.
Still, some investors believe that the stock is up today primarily because people expected so little of the company, Cramer stated.
"I happen to think if they can pull off the services and you break out the revenue and get a new Apple watch that has some some gravitas you're going to say, yeah," Cramer added.
Service revenues should be "the size of a Fortune 100 company by next year," CEO Tim Cook said on the conference call.
"Just understand there are some things going on here that the analysts didn't get," Cramer stated in the above video.
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Separately, TheStreet Ratings team rates the stock as a "buy" with a ratings score of B.
Apple's strengths such as its largely solid financial position with reasonable debt levels by most measures, notable return on equity and expanding profit margins. We feel its strengths outweigh the fact that the company has had lackluster performance in the stock itself.
You can view the full analysis from the report here: AAPL
TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this article's author.