Earnings season is in full swing, and many of the major blue-chip stocks have already made their splash with Q3 numbers. Among these are tech power players Apple (NASDAQ: AAPL), IBM (NYSE: IBM), Juniper Networks (NYSE: JNPR), Intel (NASDAQ: INTC) and Google (NASDAQ: GOOG).
But what many investors are probably asking themselves is whether or not these picks are a good buy now that they’ve had time to digest the latest numbers. Earnings only tell part of the story — and analyst price targets tell you the rest. By measuring what Wall Street expects from these tech giants, investors can safely plot a good entry or exit point for shares. That is, assuming Wall Street experts aren’t way off the mark.
Here are the latest price targets for five tech heavyweights after earnings — and the potential for future profits.
Apple (NASDAQ: AAPL)
Market Cap: $281.63 B
Median Price Target: $365
The computer and mobile-device maker Apple (NASDAQ: AAPL) is sitting pretty these days despite some lower-than-expected iPad sales. Its fourth-quarter sales soared $20.34 billion from $12.21 billion for the same period a year ago. Net income increased to $14.1 billion (or $15.15 per diluted share), compared to net income of $8.2 million (or $9.08 per diluted share) for the same period a year earlier. Stock , too, is up more than 30% in the past two months. AAPL is at +46.5 year-to-date against the Dow’s +7 and the NASDAQ’s +9.7 – with shares rising above $300 for the first time. Its success is in large part because Apple continues to make innovative devices that consumers love – and with the holidays fast approaching, just watch those number bump up. According to Thomson/First Call, its median price target is $365, 18% higher than the stock’s current valuation of $308.
IBM (NYSE: IBM)
Market Cap: $173.40 B
Median Price Target: $152
Dividend Yield: 1.86%
Fueled by its shift to the higher-margin software business, increased sales in emerging and growth markets, and growth in hardware, software and services businesses, IBM (NYSE: IBM), saw third-quarter revenue rise 3% to $24.3 billion, compared to $23.5 billion for the same period a year earlier. Net income rose 12% to $3.6 billion (or $2.82 per diluted share), compared to net income of $3.2 billion (or $2.40 per diluted share) in the same quarter a year earlier. After the good news, IBM upped its 2010 earnings outlook as it continued to show power in everything from services and mainframes to analytics. For the year, IBM projects earnings of “at least $11.40” — 10 cents higher than current Wall Street estimates. And it has reason to be boastful — even others think so. According to Thomson/First Call analysts, that’s just 9% higher than the stock is trading at currently and not all that an attractive upside.
Juniper Networks (NYSE: JNPR)
Market Cap: $16.69 B
Median Price Target: $32.50
After a rough and tumble summer, Juniper Networks (NYSE: JNPR) is bounding into fall with gusto. The information technology and computer networking products business reported third-quarter revenues up 23% from last year. Its operating margin increased to 19.3% (from 18.9%) in the second quarter of 2010 and 15.5% from the same quarter last year. Net profit was $134.5 million,(or 0.25 per diluted share), up from $83.8 million (or $0.16 per share) a year earlier. The company designs and sells high-performance Internet Protocol network products and services such as routers, EX-series Ethernet switches and SRX-series security products. Juniper said it expects healthy market demand to continue, supporting its outlook for full-year revenue growth of 20% or more. Research firm Oppenheimer recently upgraded the stock to “outperform” and Juniper shares have risen 20% year-to-date. Its median price target, according to Thomson/First Call, is in line with its stock.
Intel (NASDAQ: INTC)
Market Cap: $110.64 B
Median Price Target: $24
Intel has a lot to be thankful for — especially when things could be looking a lot worse. INTC earned $2.96 billion (or 52 cents a share), in the third quarter, compared with $1.86 billion (or 33 cents), a year earlier. Analysts expected earnings of 50 cents a share, according to a Thomson Reuters survey. The company reported operating income of $4.1 billion, and net income of $3 billion. Intel had warned that its revenue would be lower than it expected, citing weak consumer PC demand. At the same time, enterprise sales are holding up, despite economic worries that curbed many consumers’ need for personal computers. As the world’s largest maker of microprocessors (the brains of personal computers), Intel is a proxy for the overall PC market, which has stumbled in the last few months. Overall, though, the stock is moving out of a slump. INTC shares are still down 2% year-to-date. And according to Thomson/First Call, its median price target is $24 — 20% higher than current stock valuation.
Google (NASDAQ: GOOG)
Market Cap: $196.48 B
Median Price Target: $665.50
Google seems to be headed ever higher. Its fledgling mobile and online display ad businesses have given the Internet company a boom, and its third-quarter profit beatWall Street estimates. Investors and analysts have been apprehensive about the online search giant ever finding a strong new revenue stream (other than search advertisements). Still, the company reported third-quarter net income of $2.17 billion or $7.64 a share, excluding items. That beat Street analysts’ average estimate of $6.69 a share, according to Thomson Reuters. Third-quarter sales increased 23% to $7.3 billion. Excluding advertising sales which Google shares with its partners — a figure it calls “traffic acquisition costs” — the company reported $5.5 billion in revenue, which beat the $5.3 billion in revenue that analysts had forecast. According to Thomson/First Call, its median price target is $665.50 — its highest being $760 — about 8% above the valuation of the stock.