Apple Estimates Cut as Samsung Unveils Galaxy S4 (Update 1)

NEW YORK (TheStreet) -- Another day, and more cuts to Apple's (AAPL) earnings estimates, as the iPhone maker's chief competitor Samsung unveiled its Galaxy S4 Thursday night.

UBS analyst Steven Milunovich said the Galaxy S4, or Samsung's "life partner," raises the bar for Apple. "The S4 introduction continues the drumbeat of negative news," Milunovich noted in his report. As a result, Milunovich cut his fiscal second-quarter earnings estimates on Apple to $9.66 a share from $10.05 a share, and reduced his estimate on iPhone shipments by 1.5 million to 35.5 million. He also cut third-quarter iPhone numbers by 1 million to 28.5 million. The price target went to $550 from $600, but the "buy" rating remains unchanged.

The recent rumors out of Apple's supply-chain are making Milunovich more cautious on the near-term, though he noted he isn't sure whether it's anything related to demand or not. Samsung is stepping up its game with the Galaxy S4, and that, along with the rumors that Apple may release a new iPhone later this summer, have Wall Street more cautious than it's been previously on Apple.

Samsung Galaxy S4: Disaster 101

Another Apple bull, Sterne Agee's Shaw Wu, also cut his Apple estimates ahead of the potential product refreshes in the second half. He cut his revenue forecast to $41.3 billion from $42.9 billion for the March quarter, and lowered his earnings estimates to $10 a share, down from $10.25. Both fiscal 2013 and 2014 were also cut, with 2013 revenue being reduced to $180.5 billion, down from $187.4 billion. Fiscal 2014 was cut to $206.8 billion in sales, down from $213.6 billion, as Wu believes the bigger iPhone refresh is not likely to happen until 2014. Wu cut his price target to $630 from $715, but kept his "buy" rating.