Apple Is a $700 Stock: Trefis

Apple (AAPL) blew past expectations when it announced its second-quarter FY 2012 results Tuesday afternoon, posting its second best quarter ever and almost doubling its net income over the year-ago quarter.

The iPhone, the iPad and the Mac saw record March quarter sales helping Apple post over $39 billion in revenues that not only exceeded its own estimates by more than 20%, but also most analysts' as well. As a result of the growing economies of scale, gross margins improved heavily and net income surged to $11.6 billion, up 94% over second-quarter FY 2011. To put this figure in context, Google's (GOOG) entire revenue last quarter was $10.65 billion.

The record earnings was cheered by the market as the stock bucked the declining trend over the past couple of weeks to shoot up almost 8% in after-hours trading post announcement. In the wake of the earnings call, we have a revised price estimate of $700, about 16% ahead of the current market price.

See our complete analysis for Apple stock here.

International Sales Bulk Up iPhone Revenue

Apple continued to bank on the success of the iPhone 4S for the second quarter, running to sell more than 35 million iPhones last quarter. While this figure falls just short of the 37 million iPhone sales posted in the record December quarter, it easily dwarfs the 18.7 million sales recorded a year back.

After the frenetic holiday buying seen last quarter, when the iPhone 4S was launched, we expect to see a seasonal slowdown in iPhone sales. While this was true in the developed markets of North America and Europe, Apple was able to recoup most of the losses by expanding its operations overseas.