(Tech stock analyst Jon D. Markman publishes Strategic Advantage, a lively guide to investing in the digital transformation of business and society. Click here for a trial.)
Apple (AAPL) is set to launch a slew of new products in September and the news should send shares into the stratosphere.
The Cupertino, Calif.-based iPhone maker is returning to its regular September product launch cycle, according to Mark Gurman at Bloomberg. New iPhones, watches, AirPods and iPads are all coming.
Investors should buy shares ahead of the launch. Let me explain.
Traditionally Apple’s stock price rallies into the launch of new iPhones. The handsets are the biggest contributor to sales and profits. They are also halo products. They suck people into the giant Apple ecosystem. New iPhones lead to iPad, Macbook, and watch sales for Mom and Dad. Older iPhones are handed down to children who buy AirPods and iPad minis.
The more Apple devices a family owns the harder it is to escape.
The products work too well together. The ecosystem is sticky with integrated iMessage and Facetime. Apple Music family plans are irresistible, too.
The opportunity for investors is the trade going into the new iPhone reveal. In the past, it has been safe to buy the two weeks prior to the early September launch.
The exception was 2020 when the traditional back-to-school event was pushed to October 13 due to the Covid-19 pandemic. Even then, shares zoomed from a low of $102.44 on September 21 to a high of $124.38 on the launch date. That’s a nifty 20% return.
Shares are currently stuck in a consolidation between $142 and $149.
If history is any indication, iPhone launches typically come on the Tuesday following Labor Day, according to the editors at Cnet. That would put the 2021 event on September 8, with new smartphones ready for shipping on September 17.
Gurman says to expect updated Airpods, an iPad mini with a larger display and thinner bezels, and a new Apple Watch with a flatter display in addition to four new iPhone 13 variants.
Investors should not wait for the event. Consider buying the shares now and selling into the news.