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Apple (NASDAQ:AAPL) was seeing red on Friday after UBS analyst Steve Milunovich added caution to his bullish instincts on the company by cutting his price target on the stock while maintaining a Buy rating. The analyst also pruned his sales and profits estimates for the next two fiscal years. On Thursday, Apple fell 1.7 percent to $529.69.
What are the Changes in Milunovich’s Analysis?
The analyst cut his price on Apple from $780 to $700. He also reduced his iPhone sales outlook by 5 million for each of the next three quarters and the iPad forecast by 2 million each, Forbes said. For the current fiscal year, ending in September 2013, Milunovich’s profit per share estimate for Apple fell to $47 from $51.50, while for the next fiscal year it was down to $55.85 from $62.
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What Are the Reasons For the Cuts?
According to Milunovich, the build rate for iPhones at Apple’s suppliers has fallen to 25 million units for the March quarter, while his shipment model had been at 40 million units. Why?
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