Averaging the Q1 2012 estimates of the six analysts with the best track records
Whisper numbers, according to Wikipedia, emerge from widening cracks in the spreadsheets maintained by Wall Street analysts. Quoting an article by Daniel Svensson, the entry explains:
"When the estimate is first calculated by sell-side analysts, the number is submitted to companies such as First Call to be averaged with other analysts' estimates for the consensus earnings estimate. As new information is made available and plugged into the spreadsheet, the calculation may change several times leading up to a company's actual earnings release. However, the analyst is generally not going to issue a new report and revise his or her published estimate with each new calculation, resulting in the analyst's true expectations differing from his or her published number. Therefore, when someone within the firm, an institutional client, or even a retail client asks the analyst his or her expectation for the company, the response is often different than the published estimate. This number then gets passed among trading desks and professional traders as the whisper number."
Case in point: Katy Huberty's team at Morgan Stanley, which calculated its Q1 2012 estimates for Apple (AAPL) on Oct. 19, right after the company reported its Q4 2011 earnings, and never updated them -- despite, as the note Huberty sent to clients last Thursday makes clear, strong evidence right before their eyes:
"Our US holiday survey and intra-quarter comments from AT&T and Verizon indicated stronger iPhone demand than we initially expected, and give us conviction that iPhone units will beat our estimate of 30 million. We believe Apple also has a good chance of exceeding our estimate of 13 million iPads as our US survey suggests demand remained strong in the quarter despite the Amazon Fire launch. We expect Mac units to be roughly in-line with our estimate of 4.9 million, according to preliminary IDC data (though we note the original Street estimate of 5.0M may be too aggressive). We also see about 100bps of gross margin upside to our estimate of 40.4% due to a higher mix of iPhone revenue in the December quarter and better iPhone yields given limited changes from iPhone 4 to 4S."
That's why if we were to bet on Apple (which we don't) we'd stick with the folks who do revise their numbers as new information comes in. The estimates posted above are the averages of the six analysts -- institutional or independent -- whose revenue and earnings estimates were closest to the mark over the past four quarters. We tried this last quarter and it backfired (see here). For other approaches, see EarningsWhispers.com or whispernumber.com.
Below the fold: The spreadsheet from which our whisper numbers were derived. (See Can Apple still deliver an earnings surprise? for our analysis of that.) We'll publish a best-and-worst analyst list in our quarterly Earnings Smackdown when Apple's numbers come in. Tune in Tuesday after the markets close.
UPDATE: We adjusted our numbers slightly Tuesday morning when we realized that we'd neglected to factor in the estimates of the one institutional analyst -- J.P. Morgan's Mark Moskowitz -- whose predictions over the past four quarters were prescient enough to land him in the top six.
The carrier will add an estimated 1.2 million new accounts, more than double AT&T's
Data: J.P. Morgan. Chart: PED
"Santa's Sleigh Needs More Room for iPhones." That was the headline on a note to clients Thursday by Mark Moskowitz, who follows Apple (AAPL) for J.P. Morgan. Moskowitz was upping his iPhone sales estimate for the current quarter from 25.3 million to (a still relatively conservative) 28 million.
"Christmas Is Coming Early for MORE
Philip Elmer-DeWitt - Dec 4, 2011 6:45 AM ET
Expect two new models and expansion into untapped U.S. and Chinese carriers
Data: Apple Inc. via J.P. Morgan
J.P. Morgan's Mark Moskowitz, one of the last holdouts on Wall Street, has come around to what has become conventional wisdom among Apple (AAPL) watchers: That the company is set to release not one but two iPhones, an iPhone 5 and what Moskowitz calls an iPhone 4-plus.
In a report to clients Monday he describes MORE
Philip Elmer-DeWitt - Sep 19, 2011 12:14 PM ET
Sony's tablet could be the next to stumble, says another
BlackBerry PlayBook
Wall Street's best and brightest are expressing varying degrees of shock at the news Thursday that Research in Motion (RIMM), which delivered 500,000 BlackBerry PlayBook tablets in the quarter that ended in May, shipped a dismal 200,000 in the August quarter -- suggesting that most of those first half-million units are still sitting, unsold, on store shelves.
"We believe the MORE
Philip Elmer-DeWitt - Sep 16, 2011 10:31 AM ET
A big Q3 is a given. Just look at what the stock has done lately. But the devil is in the details
The Street has fallen back in love with Apple (AAPL). "Get ready for the return of the wow factor," J.P. Morgan's Mark Moskowitz told clients last week just before the stock put the finishing touches on a 28-day, $58.48 (18.5%) run that took it to $373.80 Monday afternoon, an MORE
Philip Elmer-DeWitt - Jul 19, 2011 7:48 AM ET
By Peter Lauria, contributor
The big banks are back to help the Valley's tech pirates turn into titans, but this time there's a chill in the air.
Lloyd Blankfein and Mark Zuckerberg
FORTUNE -- They're back.
After all but abandoning Silicon Valley in the wake of the first dotcom implosion, Wall Street bankers have returned to the tech Mecca en masse, in search of -- what else? -- riches to be made taking MORE
Jun 24, 2011 11:47 AM ET
Expects average sales of Apple's "quasi-tablet for productivity users" to hit 700,000/quarter
Photo: Apple Inc.
In early April, J.P. Morgan's Mark Moskowitz issued a glowing report on Apple's thinnest notebook computer in which he predicted that Apple would sell $2.2 billion worth of MacBook Airs in the next 12-18 months.
On Thursday he revised his estimates -- upward. Not only did the new models released last October sell like crazy in the MORE
Philip Elmer-DeWitt - Jun 16, 2011 10:07 AM ET
As analysts rejigger their numbers ahead of Q2 earnings, someone's not counting straight
We got two last-minute reports from analysts Friday, just a few trading days before Apple (AAPL) is schedule to report its earnings for its second fiscal quarter of 2011.
One of the analysts, J.P. Morgan's Mark Moskowitz, lowered his iPad unit sales number for the quarter to 5.4 million from 6.0 million, citing stock outs, stall outs and persistent MORE
Philip Elmer-DeWitt - Apr 15, 2011 11:56 AM ET
After the U.S (with Verizon) and South Korea, Apple is likely to target China, India and Japan
Click to enlarge. Source: J.P. Morgan
The iPhone built around the CDMA protocol that Apple (AAPL) launched in February went first to Verizon (VZ).
That made sense, since Verizon Wireless, with 94 million customers, represents the world largest market for CDMA mobile phones.
But as J.P. Morgan's Mark Moskowitz points out in a note to clients MORE
Philip Elmer-DeWitt - Apr 13, 2011 9:48 AM ET
Apple's break-out notebook, says an analyst, may represent a new category: the quasi-tablet
Data source: J.P. Morgan
With so much attention focused on the iPad, J.P. Morgan's Mark Moskowitz chose Monday to change the subject.
He issued a note to clients that focused instead on the fastest growing member of Apple's Mac line: The MacBook Air.
According to Moskowitz, revenue from Air sales tripled and units quadrupled year over year after Apple (AAPL) MORE
Philip Elmer-DeWitt - Apr 4, 2011 3:39 PM ETEvery morning, discover the companies, deals and trends in tech that are moving markets and making headlines. SUBSCRIBE
Receive Fortune's newsletter on all the deals that matter, from Wall Street to Sand Hill Road. SUBSCRIBE
Covering the digital giants of Silicon Valley and beyond, an in-depth look at enterprise companies, and the startups disrupting them. Written by Michal Lev-Ram and emailed twice weekly. SUBSCRIBE
Anne Fisher answers career-related questions and offers helpful advice for business professionals. SUBSCRIBE
| Company | Price | Change | % Change |
|---|---|---|---|
| Bank of America Corp... | 7.95 | -0.16 | -1.97% |
| Intel Corp | 26.73 | -0.43 | -1.58% |
| Microsoft Corp | 31.27 | -0.17 | -0.54% |
| Ford Motor Co | 12.28 | -0.25 | -2.00% |
| General Electric Co | 19.39 | 0.17 | 0.88% |
| Index | Last | Change | % Change |
|---|---|---|---|
| Dow | 12,938.67 | -27.02 | -0.21% |
| Nasdaq | 2,933.17 | -15.40 | -0.52% |
| S&P 500 | 1,357.66 | -4.55 | -0.33% |
| Treasuries | 2.00 | -0.04 | -1.96% |
.
