Technology Research Group Maintains Hold On Apple, Says Tougher Comps Coming (AAPL)

Technology Research Group is maintaining a Hold rating on Apple AAPL, saying it sees tougher earnings comparisons coming ahead. In the research note sent to clients, TRG writes, "Recall that Apple changed the way it accounts for iPhone sales in September 2009. This led to a measurable reduction in deferred revenue and a big lift to revenue and earnings in F1Q10. The key is that prior periods were not adjusted. Comparisons soared over the next three quarters as a result. The first quarter of fiscal 2011 will be the first with normalized comparisons. Estimates currently put top and bottom-line totals at $21.8 billion and $4.95 per share for F1Q11 – up 39% and 35% Y/Y. While these projections are more than respectable on a standalone basis, they are well below F4Q10 where sales and EPS are expected to expand by at least 88% and 118% Y/Y. How investors react to this inevitable moderation is unknown and the primary reason we are maintaining a “Hold” rating." Shares of AAPL gained 25 cents today to close at $288.19.