Apple (AAPL) Will Likely Beat Q2 EPS Views, But Miss the Whisper Number

Besides the apparent "huge" beats versus the company’s internal guidance, looking deeper at the numbers reveals two things: Apple has become less conservative with its guidance since Cook took over and Jobs passed. After being normally well below the Street with its guidance, Apple actually guided above the initial Street consensus during the past two quarters. This may be a Cook thing. The new exec may feel like the sandbagging should end as expectations for the company often get so lofty. Whatever the reason, it is important. When analysts become too optimistic, there is a chance for a miss. A sharp move higher in the Street consensus over the fourth quarter can easily be seen -- a trend which likely resulted in the Apple miss. Although the consensus started 17 percent above the company's guidance, estimates moved up 13 percent during the quarter to about 32 percent above the internal guidance. This changed in the first quarter, however. The consensus started 4 percent below Apple's guidance and moved up 12 percent during the quarter to just 8 percent above the company’s guidance, consequently resulting in a huge beat. For the second quarter, the consensus started 2 percent below the guidance and moved up 20 percent during the quarter to about 17 percent above the company's guidance. So what does this mean?