New products boost the company ecosystem and its reach into new markets
Yesterday’s unveiling supplied ample entertainment for the onlookers and it wasn’t only because of the star-studded audience or the performance from U2. Apple launched its iPhone 6, the highly anticipated Apple Watch, as well as a new payment system to rival Google and PayPal.
Investors were in the mood for some selling and the price closed at 97.99 yesterday. However, none of the large shareholders signaled any change in their long term bullish sentiment. Some like Carl Icahn even increased their portfolio, identifying the last several weeks as a buying opportunity before a continued climb to a market cap of $1 trillion.
The long term trend is reflecting the company’s efforts to boost their margins and market share. In line with this they introduced the iPhone 6 which came out to a very good reception and is set to challenge for a significant portion of the market of large screen smartphones. Its pricing will give it a broader appeal in a segment that was a vital target for Apple, who have now closed the gap to their competitors.
The Apple Watch (the first new product to ditch the i-prefix) offers a new approach to the smartwatch concept. Instead of being a poor substitute for a smartphone, it complements it, focusing on the health and fitness of its wearer. With an estimated profit margin of just above 44% this could be another winner from Apple that captures the imagination of its loyal consumers.
Apple Pay is another key point which they hope will bring in a steady revenue as the global market for financial transactions is $4 trillion. This service aims to change the way transactions are made, by using NFC (near field communication) payments, which can make physical wallets and credit cards obsolete. With confirmed partnerships with the major credit card companies they’ll be looking to succeed where Google, PayPal and Square have so far failed.
With so many new directions and ventures, most investors are positive that the price is set to continue its climb, even more so with the additions in wearable technology and upgrades to the iPhone line. The challenge from Google and Samsung was accepted, we’ll be waiting to see how they respond.
Do you think Apple’s new products and services delivered on expectations? Will their stock price continue its rise?