We mentioned yesterday that Intel beat expectations in its earnings report last week, leading to a big runup in the chipmaking sector. Here's a prediction for today: Apple, which is slated to report its earnings today, will also outperform its projections.
This isn't necessarily because the second quarter will have been exceptionally kind to Apple; it's just what the company always does. In April, for example, Apple reported a $1.33 per share profit - 40 percent more than it had projected in January. The revenue number, $8.16 billion, was 5 percent higher than the projected figure. But no one cared, because Apple beating its projections was widely expected by Wall Street. Some analysts use a rule of thumb that Apple will always beat its projected earnings per share by 35 to 40 percent.
So if Apple makes news by releasing outrageously rosy quarterly figures today, don't get too excited. The people who have been buying and selling their stock have already taken those numbers into account.
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