[/caption]In the past, the investment community waited with bated breath for the earnings from the likes of General Electric or Walmart to shepherd them through the mysteries of the market. But now that has changed...investors, even if they don't want to, now look at Apple as an investment guide post.
In the past few days, in a time of economic trouble, we have seen a spate of earnings from various companies – IBM, Yahoo, GE, Texas Instruments - but none rocked and blew away the expectations of the Wall Street’s pundits like the earnings of Apple.
With all the negative news about its' antenna, and the seeming inroads from the Droid X smart phone, Apple’s earnings left no doubts that it is the big elephant on Wall Street, and moreover, the tech trendsetter.
Apple’s $3.25 billion profit and 78% gain over last year was adding to the good news, because it was only last week that it passed Microsoft in market cap. It must be noted that these earnings are the strongest revenues in Apple’s storied history.
These are some of the specifics of Apple’s spectacular quarter, as provided by Daily Finance: Apple sold 8.4 million iPhones, nearly 3.27 million iPads, and 3.47 million Mac computers. The Mac sales numbers was a record and in an era of the popular iPads and iPhones, even the almost forgotten iTunes generated some $1 billion, an increase of 25%.
Apple's shares were up 5% in after-hours trading. It is almost a given in the investment community that Apple has a tendency to low-ball future expectations. But look at what Apple has done: its' share price is up 20% this year and some 65% over the last year – over the last three years, Apple has tripled its' revenue and quadrupled its' earnings.
To underscore how lucrative business has been for Apple is the fact that it generated $4 billion in cash during the quarter, and they are now sitting on a cash bonanza of $46 billion. Apple reported earnings of $3.51 per share, far exceeding the analysts’ expectations of $3.11, on revenue of $15.7 billion. There is no low balling these projections for Apple’s next quarter, which is looking for revenues of $18 billion and $3.44 earnings per share.
What is it that Apple is doing well? Pleasing and pleasantly surprising the consumers. Case in point, the most successful product launch in Apple's history was its' iPhone 4, which brings attention to its other unique products like the iPad, and the reliable Mac.
Apple is not resting on its' laurels, it is also rumored that they still have tantalizing new products to come later this year. There should be no question mark following the query, which asked if Apple is the new Bellwether of the stock market – because it is obvious that the question is rhetorical!
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