Deutsche Bank Reiterates Buy Rating, $440 Target On AAPL

Deutsche Bank is reiterating its Buy rating and $440 PT on shares of Apple AAPL.

“We conducted a series of channel checks over the weekend where we found very strong demand for the newly released iPad 2,” Deutsche Bank writes. “We called ~100 stores (50 Apple retail stores, 20 Best Buy and Wal-Mart stores and a handful of AT&T and Verizon stores) and were surprised by overwhelming demand for the new iPad.

“Our checks pointed to a shocking 100% stock out rate across Apple/authorized retail stores just a few hours into the official launch Friday evening, contributing to what we believe was one of the company's most successful product launches to date. Given the 100% stock-out rate, it appears Apple experienced strong demand for all versions of the iPad 2 (although the AT&T 3G model typically sold out faster than Verizon).

“Apple retail stores and partners were unable to keep up with demand through the weekend, with all locations we contacted Saturday reporting stock-outs. Meanwhile, on-line purchases face elongated wait times (~3-4 weeks) on Apple.com. We believe initial weekend volumes were well over 500K due to strong on-line and retail demand, where shipments could have been dramatically higher if there was more supply.”

Further, Deutsche Bank added that it expects the international roll-out (Australia, Canada, France, Germany, Italy, Japan, Spain, Switzerland and the UK), starting March 25, 2011, will support continued robust demand.

“The iPad 2 consolidates Apple's position as the innovation yardstick within the tablet space and we expect it dominate the segment,” Deutsche Bank added. “We remain cautious on the non-iPad segment of the tablet market and expect new entrants to struggle gaining traction in the market.

“Based on extremely robust initial demand for the new iPad, we now view our estimate of 30M iPads for CY11 as very conservative.”

Apple closed Friday at $351.99.