Analysts at Citigroup have recommended that investors buy AAPL ahead of future product releases. These product releases are said to include Mac OS X Leopard, touch-screen video iPod, higher capacity iPod nanos, and a 3G version of the iPhone.
The analysts at Citigroup expect Leopard to be released on June 11 as WWDC 2007 kicks off, the firm estimated that the release will generate between $50 and $75 million in incremental revenue per quarter.
Citigroup Richard Gardner has been looking into the future prospects of the iPhone and believes that it will launch "late-June." In the report to investors Garner noted that Apple could surprise Wall Street with attractive economics from the iPhone.
"We believe that Apple could receive as much as $200-300 per new subscriber from Cingular in up-front payments and residuals (depending on whether the phone is sold in Apple’s own stores or Cingular’s stores)," Gardner wrote. "This is roughly 2-3X the payment that the Street currently expects and provides Apple with significant flexibility to drop prices or earn higher margins. We also expect Apple to release a 3G version of iPhone during [the first half of 2008]."
Gardner also wrote that new iPods are likely to hit at the beginning of the Fall, these will include a 12-16GB nano priced at $249, and a video iPod with touch-screen priced at $250-400.
"These products should launch in August or September and position Apple well for the peak Holiday 2007 selling season," he wrote. "Finally, we expect a newly redesigned MacBook Pro in the Fall, new iterations of all Apple laptops featuring Intel’s new Santa Rosa platform in the Summer or early Fall, and perhaps an ultra-portable laptop at some point this year."
Citigroup also looked ahead to Apple's Quarter 2 financial results that will be reported on April 25. Richard Gardner predicted that gross margins will come in above 32-percent and as a result he raised his per-share earnings estimate from 71 cents to 73.
The analyst believes Apple will report sales of 1.45 million Macs during the quarter and 10.8 million iPods representing 30- and 27-percent year-over-year growth respectively.