Apple Earnings Preview (AAPL)

Apple Inc. AAPL will be releasing its fiscal Q2 earnings today after the closing bell. Apple is notorious for under-promising and then over-delivering on its numbers. The company almost always beats consensus estimates, and it is usually by a considerable margin. Indications are that this quarter will be no different. Key drivers are likely to be new Verizon Wireless iPhone sales, the iPad 2 launch, and the company's new line of MacBooks. Wall Street consensus earnings per share estimates going into the print are $5.36. The high estimate on the Street is $6.33 and the "whisper" number (real expectations) appears to be in a range above $6.50. In the year ago quarter, Apple reported EPS of $2.45. On the revenue front, the Street is looking for $23.34 billion for the quarter. The high estimate is $24.86 billion, and the "whisper" number is around $24.5 billion, and maybe a little higher. In the year ago quarter, Apple recorded sales of $13.5 billion. For the second quarter, Wall Street is looking for iPad shipments of 6.2 million and iPhone shipments of 16.6 million. Mac shipments are expected to be 3.6 million. Going into fiscal Q3, analysts are anticipating EPS guidance of $5.25 on revenues of $23.4 billion. Apple shares have been consolidating between $322 and $360 in 2011. Year-to-date, the stock has risen almost 7%, but the trading has been quite choppy. Apple is not currently trending, but rather trading in a range. The stock put in a similar formation between April and September of 2010, which was followed by a very strong breakout. Today's earnings report could be the catalyst that allows AAPL to break out once again and head towards the $400 level. Alternatively, any kind of misstep or disappointment, may cause AAPL shares to retrace back towards the lower end of its recent range.