Apple EPS Will Be Better Than Expected, According To Goldman Sachs
Goldman Sachs is back again with a forecast that sees Apple post a better-than-expected EPS ratio for the last quarter. As per the analysts, the EPS of Apple will be around $1.21, higher than the expected value of $1.19.
The reason behind a jump in the EPS is attributed to better performance in the services sector and sales of Mac. If we look at the revenue from Mac, it is expected to be around $9.4 billion.
$21.8 Billion Revenue From Services Sector
The earlier forecast for the Mac revenue was $9.3 billion, which is now changed to $9.4 billion by Goldman Sachs. On the contrary, FactSet has set a figure of $6.3 billion which is way lower than the $9.4 billion.
According to Goldman Sachs, the services revenue of Apple will be $21.8 billion, with an increase of 11% YoY. At the same time, the market is expecting a revenue figure of $20.7 billion with only a 6% YoY growth.
The reason behind a jump in the services revenue is mainly due to an uptick in the App Store spending. Similarly, Apple also enjoyed growth in its revenue from the advertising sector as well. And last but not least, AppleTV is also bringing more revenue for the company.
And if the Fed decides to switch towards rate cuts later this year, it would be yet another positive development for Apple & other tech companies.
For the moment, there are some concerns among investors about downside risks and valuations of Apple Inc. According to them, the iPhone user base is the main foundation for the monetization of the services.
Overall, Goldman Sachs sees Apple to have improved free cash flow along with better earnings for the last quarter. If the Goldman Sachs valuation of Apple turns out to be true, we will see a significant upside in the APPL stock. In addition, it will also provide insight into other technology stocks and how they performed in the last quarter.