Analysts on the lookout for signs of slowdown in Apple's earnings announcement tomorrow.
All eyes will be on Apple tomorrow, with its quarterly earnings likely to show whether the company can really ride out a slowdown in consumer spending.The company's share price has fallen 50 per cent since the start of the year, and some analysts are wondering whether a fall in demand for Mac computers can be offset by new products such as the iPhone.
Speaking to Reuters, Pacific Crest Securities analyst Andy Hargreaves said: "The concern about the stock is that because of the macro-environment people aren't going to be buying Macs, people aren't going to buy iPhones, because they're expensive."
He expects the company to ship five million iPhones in the fourth quarter.
However, there is feeling that the share price fall means Apple's stock has been oversold and undervalued, with iPhone in particular proving a boon to the company in terms of cash flow if not earnings.
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Bernstein analyst Toni Sacconaghi said: "Investors appear to be valuing Apple on an earnings multiple, rather than on cash flow, which fundamentally undervalues the company given the huge deferred revenue growth associated with the iPhone."
Apple is expected to earn $1.11 a share in its fourth quarter, according to a poll of analysts by Reuters estimates.
