Barclays Capital’s Ben Reitzes this morning reiterates an Overweight rating on Apple (AAPL) shares and a $555 price target following a meeting at Apple headquarters with CEO TIm Cook and CFO Peter Oppenheimer.
Reitzes reiterates a belief that Apple will institute a dividend “ultimately,” while noting that Cook’s comments to him we’re simply a reiteration of the position he stated on the fiscal Q4 conference call, namely that he is “not religious about holding cash or not holding it.”
Reitzes notes Apple has $81 billion in cash and securities now, and may generate cash flow of $38 billion this year and $45 billion next year. A share repurchase is less certain, and “given Apple’s rapid growth, we don’t believe the buybacks lever is necessary at this stage.”
Other observations from the meeting:
Cook fully understands Apple��s unique culture and how to maintain its winning ways [...] Tim Cook will maintain his visibility with investors �C but Apple��s mystique can be sustained.
Tim Cook clearly seems excited about Siri in terms of how people have incorporated it into their daily lives. While he did not specify, we believe this platform is in its very early innings, especially since Siri is considered by Apple to be in a ��beta�� form right now and not perfect.
We believe that our estimate for iPhone unit sales of 30.7 million for the December quarter is conservative considering the pace of the international rollout underway.
We agree with Tim Cook �C iCloud is profound. It basically makes the cloud the digital hub – not the Mac or PC. As a result, we believe that iCloud is the ��sneaky�� product launch of 2011, which could actually drive the most long-term ! value to the company.
For FY12, we estimate revenues in APAC will grow 76% y/y to $39.7 billion in revenue, helped by China (this figure excludes retail). Cook seems very excited about all products�� potentials in this region, including even Macs, which we believe will continue to outgrow the market (see below).
Apple shares today are up $1.58, or 0.4%, at $398.99.
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