Piper Jaffray Continues To Be Overweight On Apple (AAPL)

Piper Jaffray has an Overweight rating and a $483 price target on shares of Apple Inc. AAPL. In a note to clients, Piper Jaffray writes, "Following a successful Verizon launch (over 90m subs), Apple no longer has any exclusive agreements with iPhone carrier partners. And with the introduction of a CDMA iPhone, Apple has dramatically increased its addressable market in its most critical markets, the U.S. and potentially with China Telecom (also 90m subs) and Indian carrier Reliance (110m subs). Our estimates of iPhone units by carrier partner shows that Apple is opening itself to important pockets of addressable iPhone subs, which may lead to upside to our CY11 and CY12 iPhone estimates." Piper Jaffray goes on to say, "Most investors believe Apple's earnings growth will slow to 15-20% in 2012. We believe this is why shares trade at 13x our CY12 EPS. We believe investors are underestimating the growth opportunity in mobile over the next 5 years. We expect iPhone (39% of business today) to be the biggest variable in Apple's growth. If the iPhone grows in-line with the smartphone market at 35% (CY11 growth rate), Apple would sell over 200m million iPhones in 2015. This would imply over 40% of Apple's business is growing at 35% in 2013-2015. We expect the iPad will grow faster than the iPhone and the Mac and iPod will grow slower. The net is we believe a sustainable 25-30% growth rate in earnings could be achievable through 2015." Shares of Apple closed at $338.61 yesterday, down $11.95.