THE APPLE INVESTOR: Facebook / Spotify Partnership Should Scare Apple

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AAPL Up On Weak Consumer Spend Numbers
Consumers spent more in April but much of the increase was eaten up by inflation. After discounting for the jump in prices, spending barely budged. Nevertheless, the markets are responding positively and shares of AAPL are bouncing around in positive territory. Upcoming catalysts include the WWDC starting June 6; iPad 2 sales updates; the next iPhone launch this fall; smartphone push into China and emerging markets; iTunes and other cloud initiatives; the continued evolution and adoption of Apple TV; and new platforms such as video, books / publishing and social (Ping). Shares of Apple trade at 11x Enterprise Value / Trailing Twelve Months Free Cash Flow (incl. long-term marketable securities).Analyst Raises Estimates For This Year And Next On iPhone Roadmap (Barron’s)
Wedbush Securities analyst Scott Sutherland reiterated his Outperform rating on shares of Apple while raising estimates for this year and next on the prospect Apple has “enough horsepower to drive continued revenue growth and upside to estimates.” The main catalyst is the iPhone roadmap. Here are his estimate changes for the current quarter:

  • iPhone estimate: Now 18.65 million units, up from 17.7 million
  • iPad estimate: Increased to 5.5 million units, up from 5 million

Earnings estimate changes for the current fiscal year (ending Sept):

  • Revenue: $103.5 billion in revenue, up from $102.9 billion
  • EPS: $24.71 per share, up from $24.30 per share

Estimate changes for fiscal 2012:

  • Revenue: $124.6 billion in revenue, up from $121.7 billion
  • EPS: $28.50 per share from a prior $26.81 per share

He also raised his price target to $450.

New Facebook / Spotify Partnership Should Scare Apple (Forbes)
Facebook has partnered with Spotify on a music-streaming service that could be launched in as little as two weeks. The service allows users to play from Spotify’s library of songs through Facebook including a function that allows users to simultaneously listen with their friends over the social network. The integration should scare Apple, which reportedly cut a deal with Facebook to make iTunes Ping more social. The deal fell through at the last minute, and Ping never took off. Read more at Business Insider.

iPad Launching In More Countries Today (9To5Mac)
Apple launched the iPad 2 in Russia, Brazil, Chile and the Ukraine today. While little information has emerged about Brazilian plans, Russian tablets will reportedly be sold at a variety of stores. Vendors expect the iPad 2 to sell “even faster” in Russia versus Germany, Denmark and Norway, where initial stock vanished within three days.

iPhone 4 Finally Available In India, One Year After The US Launch (The Unofficial Apple Weblog)
The iPhone 4 is finally available in India today, nearly one year after its launch in the US. The phone will be available from Airtel and Aircel for both postpaid and prepaid subscribers. Both companies are offering “reverse subsidy” by giving discounts on the monthly bill plan for a period of 24-months.