Goldman Sachs: Apple Investors Will Shift Focus To iPhone 6s Refresh

In a report published Wednesday, Goldman Sachs analyst Bill Shope maintained a Buy rating on Apple Inc. (NASDAQ: AAPL), with a price target of $163.Apple reported its 3QF15 results marginally ahead of the estimates, largely due to an increase in the average selling price of the iPhone. The company's quarterly revenue of $49.61 billion exceeded the Goldman Sachs estimate of $48.98 billion. The company's EPS of $1.85 was ahead of the $1.80 Goldman Sachs estimate. Analyst Bill Shope noted, "Gross margin of 39.7% was just above our estimate of 39.6%, and operating margin of 28.4% also beat our 28.0% estimate." Shope pointed out that the company's F3Q performance was "a solid performance for the tail end of the iPhone 6 cycle, and investor attention is likely to quickly shift toward the iPhone 6s refresh later this quarter."Apple guided to F4Q revenue of $49-$51 billion and gross margin of 38.5-39.5 percent. "While the next iPhone family faces a tough set of comps, we continue to believe there is upside to expectations – particularly on gross margins," the report added.Shope termed the concerns over muted unit growth of the iPhone as "overblown" and pointed out that only "27% of the current iPhone installed base "have upgraded to a 6 or 6 Plus thus far." The analyst expects "a new user and replacement tailwind" to "continue into the next cycle."The EPS estimates for FY15 and FY16 have been raised from $9.07 to $9.09 and from $10.64 to $10.65, respectively.