"Apple (NASDAQ: AAPL), a holding on our recommended buy list, delivered another blowout quarter, driven by booming sales of both the iPhone and its Macintosh computers," notes analyst Geoffrey Seiler.

In his BullMarket.com advisory, he suggests, "Overall, Apple's results are nothing short of amazing." Here, he provides an in-depth analysis of the quarter, his outlook, and the reasoning behind the boost to his longer-term price target to $270 a share.

"Apple sold 7.4 million iPhones in the quarter, 7% more than the year-ago quarter, and 3.05 million Macs, a 17% year-over-year increase. The end result was that the company posted a whopping 47% increase in Q4 net income.

If there was one stock you wish you had bought when it was being crushed by the financial crisis along with every entity out there, it's Apple (NASDAQ: AAPL). Shares of the company, which counts Microsoft (NASDAQ: MSFT) and Dell (NASDAQ: DELL) as rivals, have more than doubled since they hit a 52-week low of around $78 per share. Really, did we think this one wasn't coming back? Hey, I fully admit, I've been a bear on Apple at different points during the downturn. Difficult not to be, with consumer sentiment and all that.

Well, it's hard to be a bear now. Last night, the market welcomed Apple's Q4 earnings with open arms. How could it not? The first paragraph of the press release tells a story of profound growth. Sales increased 25%, and earnings per share soared over 40% to $1.82 per share.

"Apple (NASDAQ: AAPL), already on our recommended list selection, announced fiscal Q3 earnings after the bell last night that, to no one's surprise, easily topped Wall Street estimates," notes Geoffrey Seiler.

In his Bull Market.com advisory, he reviews the latest earnings report and offers his outlook for the shares -- including a boost to his price target for the stock.

"For the quarter ended June 27th, the company earned $1.23 billion, or $1.35 a share, up 15% from $1.07 billion, or $1.19 a share, a year ago. Analysts were only looking for EPS of $1.17.

This was a very light economic day that was again sort of trumped by a Ben Bernanke speech, but this was to the Senate panel rather than yesterday's House panel. Earnings dominated the trends of the news and the markets spent all day trying to figure out if they wanted to be up or down. However, tech stocks have managed to rise and rise. And rise. Right before the closing bell, this looked to be the eleventh day up in a row.

Here were today's unofficial closing bell levels:

Dow 8,881.26 -34.68 (-0.39%)
S&P 500 954.06 -0.52 (-0.05%)
Nasdaq 1,926.38 +10.18 (0.53%)

Major Analyst Upgrades

Apple Inc. (NASDAQ: AAPL) was downgraded Tuesday to Underperform from Outperform at Calyon Securities. The analyst cut the EPS estimates and set a $90 price target on the stock. Why? Mostly due to concerns over Mac sales because of the recession and the fact that Apple has a premium pricing model on its Macs. Interestingly, the analyst also cut iPhone unit estimates slightly. Steve Jobs' health was also mentioned as a concern.

That wasn't all, another analyst at Kaufman Bros. trimmed his revenue estimates for the current quarter, but kept EPS estimates the same and the Buy rating.

Apple Inc. (NASDAQ: AAPL) has about 250 retail stores. It's not surprising that their sales would be off. The recession in retail revenues has spread almost everywhere.

But, the trouble at Apple stores may be deeper than many investors would expect. According to Barron's, "Apple's same-store revenues, a key retail metric comparing sales of stores open for at least a year, slid 17.4% in the December quarter from a year earlier, reports Needham hardware analyst Charlie Wolf." Visitor traffic is fairly flat, so a lot of people are just hanging around checking out the Macs and iPods.

Too much has already been written about what a great quarter Apple (NASDAQ: AAPL) had. It beat earnings forecasts. It met expectations for Mac sales. It exceeded expectations for iPod sales, and it was a little light on iPhone shipments.

So, what was the key to Apple's success? More than anything else, it is that the iPod keeps selling even though there are more than 200 million of them somewhere out there in the world. Apple sold another 23 million iPods, a record. And, that was the trick.

Have a look at Apple's iPod pricing. The average price between the cheapest version, the Shuffle, and the next cheapest version, the Nano, is about $99. During a holiday slammed by a recession, how may products are available for $99? Especially products that are great gifts?

Buy a friend an iPhone -- it comes with a hefty two-year calling plan that makes it quite expensive. Buy a Mac -- that will probably set the buyer back $1,000.

The iPod is still a desirable present. It is from Apple, after all. But, what earnings did not tell is how little it costs to get one and what that means during hard times.

A $99 gift. And, by the way, with it strong earnings, Apple should trades at about $99 today.

Douglas A. McIntyre is an editor at 24/7 Wall St.

The mystery surrounding Apple Inc. (NASDAQ: AAPL) Chief Executive Steve Jobs continues.

After several blogs reported last week that Jobs, who has battled pancreatic cancer, was ill again, the mercurial executive decided to come clean, especially since he decided to take a pass on the mammoth Macworld conference. At least, sort of.

In a highly unusual "letter" to "Apple Community", Jobs said that doctors have found a hormone imbalance that was "robbing" him of proteins his body needs to be healthy.

"The remedy for this nutritional problem is relatively simple and straightforward, and I've already begun treatment," Jobs said in a statement. "But, just like I didn't lose this much weight and body mass in a week or a month, my doctors expect it will take me until late this Spring to regain it. I will continue as Apple's CEO during my recovery."

Apple (NASDAQ: AAPL) has not traded at $50 since July 2006 and has not been below that figure for any extended period since 2006. In the scheme of things, that is not so long ago.

The basis of Apple's run to over $200 was that iPod sales would continue to be solid, the Mac would sell at a rate better than the overall PC market, and the iPhone would be Apple's new profit center. The recession and the Mac hitting the upper level of its natural market may have undermined that formula.

Goldman Sachs downgraded Apple yesterday, saying that the recession had caught up to the company. But the news got worse than that. According to The Wall Street Journal, "Sales of Macs in U.S. stores last month declined 1% from a year ago, while industry-wide PC sales rose 2%, according to research firm NPD Group." That will come as a shock to almost every investor holding shares in Apple. The Mac has outperformed PC sales for the last two years.

There are several reasons that Mac sales may be peaking. The first is that the Mac is relatively expensive compared to many PCs that have had to cut prices, in some cases, below $500 to keep customers coming in. In addition, the Mac is up against an entrenched PC market with companies that have IT directors who do not want to support both Windows and the Mac OS. That adds to the expense, and it is a recession.

Apple is a stock where much of its value is based on cult like expectation. It rises because each new product will do better than the last and each quarter will outperform the one before it. That may be coming to an end and the disappointment will be profound. Apple trades at $94 now, and it may not see that price again for a long time.

Douglas A. McIntyre is an editor at 247wallst.com.

This post is part of a series featuring bargain stocks that are worth a look now. See more Cheap Stocks.

In addition to being a crackerjack equities analyst, I'm also something of a makeup aficionado. Credit my upbringing for this; my mother grew up in the '50s, and even today, she is loathe to so much as check the mail without a full application of liquid eyeliner. So, as you might imagine, I'm quite familiar with Estee Lauder Companies (NYSE: EL).

While it's technically a consumer-goods company, you might have a perception of Estee Lauder as a peddler of upscale cosmetics -- in today's economy, high-priced eyeshadow is unarguably a discretionary expense worth cutting. However, EL's reach is probably broader than you realize. For example, the company owns MAC, a line that caters specifically to professional makeup artists and amateur makeup fetishists. No matter the economic climates, these two constituencies can be counted on to keep shelling out for blush.

Estee Lauder also boasts the lower-priced Clinique line, a staple of many women's' skin-care and cosmetics routines for decades. On the high end, the company sells fragrances by the likes of Tom Ford and Michael Kors -- two names favored by the kind of consumers who do still have disposable income to spare. Plus, its Bumble and bumble brand name is a favorite of professional hair stylists.

"Apple (NASDAQ: AAPL) is offering a rare opportunity and is now one of our favorite ideas for investors with a multi-year time horizon," says Bill Martin.

In his BullMarket.com, the trading and investing expert explains, "Our bullish thesis on Apple revolves around cash; both the cash on its balance sheet and the cash it is able to generate."

"With approximately $24.5 billion in cash and no debt, about $27.50 of Apple's share price is cash. Meanwhile, the company generated $9.1 billion in cash the past fiscal year.

"Given the way revenue with the iPhone is reported (it's recognized over the life of a contract, not upfront), the cash Apple generates is actually a lot higher than what its earnings indicate.

"Combined, this makes common metrics like P/E ratios not a great way to value the company. If you instead substitute an Enterprise Value (which is basically the market cap with net debt or cash added back in) to cash flow ratio, the stock is trading at only about a 6x multiple.

Apple Inc. (NASDAQ: AAPL) stock is down 54% from its December 2007 high of $200 a share. We know the economy is in rough shape and consumers are cutting back. But by one measure, Apple stock is a bargain. Should you buy it?

Apple trades at a Price/Earnings to Growth (PEG) ratio of 0.75 (based on a P/E of 17.7 on earnings growth of 23.7% to $6.52 in FYE ending September 2010). A PEG value less than one is considered an attractive price. So it looks cheap to me -- but only if you believe that earnings forecast. And economic woes mean it's likely that the numbers will be lower.

If Steve Jobs remains in the CEO position for the next several years, it is reasonable to expect more ground-breaking innovations from Apple. But one short seller is betting that the benefit of any innovations will be offset by the fact that in a weak economy, people will spend less on Apple's products, resulting in weaker Mac sales. And he does not see Apple investing in new products like the iPhone.

When the short interest in companies that are as robust as Apple (NASDAQ: AAPL) increases, it is a sign that investors are willing to bet against almost any firm in this market. For the period ending October 31, shares hold short in the big consumer electronics firm were up 16% to 28.1 million shares. The figure compares with short holdings as of the middle of October.

There is little obvious reason to think Apple will go lower. Its shares are below $94 already, down from almost $203 a year ago. By almost any measure, Apple is one of the most successful companies in the world, with a clean balance sheet, $33 billion in cash, growing sales, and the best products in its market segments.

The theory behind shorting Apple is that its holiday quarter will be weak. But that may be a fool's gamble. Most evidence points to Mac sales continuing to grow sharply even with most PC sales falling. The iPhone is taking market share from all other smartphones. The overall handset category may be down for the rest of the year, but Apple's product is almost certain to pick up sales.

By moving into Apple, a lot of short sellers will get burned.

Douglas A. McIntyre is an editor at 247wallst.com

This post is part of a series in which TheStockAdvisors.com asked financial experts to name their top stock pick if McCain or if Obama wins the election.

"We expect that an Obama-Biden victory will provide a renewed sense of optimism on the part of consumers; to profit from this expected trend is Apple (NASDAQ: AAPL)," says growth stock specialist Nate Pile, editor of Nate's Notes.

"Apple has been crushed this year on concerns about consumer spending. Any improvement in consumer spending that may come from an Obama win should only add fuel to the fire that is already burning brightly for Apple.

"The company's product line-up is one of the best in the consumer electronics space, and as we have been anticipating for a number of years now, success with products outside of the PC market is translating into growth rates for the Mac line that are significantly above the industry average.

"Apple's stock price certainly suggests that there is a huge buyer boycott going on when it comes to tech stocks these days.

"Part of the reason for the continued slide is being attributed to the lack of a 'major announcement' at a recent publicity event, though I believe the fall has more to do with where we are currently at in the 'psychology cycle' on Wall Street than anything else.

"Though we may have to wait until we get through tax-loss selling season this year to see a significant rebound in the stock price, we believe Apple's best days are still ahead of it, and a win by Obama will only help to accelerate the trends that are already underway for the company."

Steven Halpern's TheStockAdvisors.com offers a daily look at the latest market commentary and favorite stock picks and investment ideas from the nation's leading financial newsletter advisors.

In July 2006, Apple (NASDAQ: AAPL) dropped below $60 just after announcing quarterly earnings. The market was disappointed. Operating margins for the period were only 13%.

It would be hard to find people who think Apple will fall back to $60, but the dynamics of the company's earnings are such that poor holiday sales could push the stock back in that direction.

For the last calendar quarter of 2007, net income rose 58% to $1.6 billion. Mac sales were unusually strong and iPod units sales were still growing quickly. The growth of the Mac was actually extraordinary. Apple sold 44% more Macs than it had in the last calendar quarter of 2006. The new iPhone had its first really big quarter selling 2.3 million units.

Apple may be facing a holiday season where Mac sales grow very little, iPod sales actually fall and iPhone sales miss Wall Street targets. The Mac may simply be hurt by the recession. There have been over 170 million iPods sold since the product was introduced six years ago; it may be reaching a point of market saturation. No really significant changes to the iPod have been made in over a year.

Problems with the iPhone's connections to 3G high-speed internet networks could hold back its sales.

Apple's stock is down almost 50% since last December. That may just be the beginning.

Douglas A. McIntyre is an editor at 247wallst.com.