The market was clearly not impressed by Apple Inc. AAPL 1.15%’s Q1 earnings report, as the stock was down more than 7.1 percent in Wednesday morning trading. However, Citi analyst Jim Suva sees both positive and negative takeaways in Apple’s Q1 numbers.

Bulls: Here Are 5 Positives

Apple bulls can take comfort in the following five positives:

• 1. iPhone unit sales of 51.2 million for the quarter came in ahead of the 50 million consensus estimate, despite whispers that iPhone numbers would disappoint.
• 2. Apple upped its already generous capital return program by boosting its dividend 10 percent (to a yield of around 2.4 percent) and upping its stock buyback to $250 billion (above Citi’s expectation of $240 billion).
• 3. Apple generated $11.6 billion of operating cash flow and returned $10 billion to shareholders via buybacks and dividend payments.
• 4. Apple now has $153 billion in net cash on its balance sheet, or $27 per share.
• 5. iTunes software and services revenue beat expectations and installed base purchases delivered 27 percent year-over-year (Y/Y) growth.

Bears: Here Are Some Negatives

But there were also plenty of negatives, including the five that Suva highlights:

• 1. Sales guidance of $41–53 billion came up short of consensus expectations of $47 billion.
• 2. Gross margin outlook of 37.5–8 percent also came up short of expectations of 39.2 percent.
• 3. Average sales price (ASP) of the iPhone came in at $642, below expectations of $659.
• 4. Apple’s EPS of $1.90 fell…

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