UPDATE 1-JP Morgan cuts Apple Q2, FY09 outlook

March 6 Fri Mar 6, 2009 10:44am EST

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March 6 (Reuters) - J.P. Morgan Securities lowered its second-quarter and fiscal 2009 earnings and revenue estimates for Apple Inc (AAPL.O) on a deepening macro-economic downturn. Analyst Mark Moskowitz also cut his outlook for Mac and iPhone unit shipments in the second quarter, saying inputs from industry contacts suggest that Mac and iPhone volumes have been trending below expectations.

Apple shares fell almost 6 percent in early trade.

"In prior recessions, the consumer had been fairly resilient, but mounting job losses, shrinking home values, and tight credit stand to make the current recession quite more challenging," Moskowitz wrote in a note to clients.

Moskowitz said he estimates Apple derives 70 to 75 percent of its revenue from the consumer vertical, due to which the next few quarters stand to get "bumpy."

He cut his second-quarter earnings estimate for Apple by 1 cent to $1.01 a share, and revenue estimate to $7.62 billion from $7.72 billion.

Moskowitz cut his estimate for Mac unit shipments in the second quarter to 2.19 million from 2.39 million, and iPhone unit shipments estimate to 3.4 million from 3.8 million.

The analyst also lowered his fiscal 2009 earnings estimate for Apple to $4.73 a share from $4.82, and revenue estimate to $32.98 billion from $33.97 billion.

"Notwithstanding the current macro pains, we believe the company's content-driven product portfolio is capable of a multi-year revenue outperformance relative to its peers," Moskowitz said.

He cut his price target on the stock to $100 from $102, but maintained his "overweight" rating.

Shares of the company fell $4.97 to $83.87 in early morning trade on Nasdaq.

The Nasdaq Composite Index .IXIC turned negative and fell to a 6-year intraday low, weighed by declines in large-cap technology companies including Apple and Qualcomm (QCOM.O). (Reporting by Tenzin Pema in Bangalore; Editing by Himani Sarkar)

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