Apple and Google, apart from being very popular tech companies, have more than a few things in common; first of all it seems like their stocks are almost always going up.
Apple recently launched their anniversary iPhone, the iPhone X (pronounced: ten) and Google is hot on their heels with the Pixel 2. What we want to figure out here is: what can we expect to happen in terms of revenue and share price for both of these tech titans following their product launches?
It’s really no surprise that their stocks does well compared to other tech companies. The reason is quite simple and is another thing both business have in common: they enjoy a unique competitive advantage.
Apple (NASDAQ: AAPL) for several years has had a free ride in terms of commanding higher prices for its products. Owing to its unique combination of beautifully designed hardware and software, the California based company can expect its stock to rise sooner or later. Google, of course, is synonymous with web search. The company controls a commanding two-thirds of all internet search queries despite being inaccessible in China.
The other thing that Apple and Google have in common is that they both conduct product launches that, for a short period of time, capture the attention and wonder of people all over the globe. Apple pioneered this marketing method, and since Google decided it was time they sold hardware via the Pixel (and others), they’ve aped Apple’s successful tactic.
Apple share price has for the most part of its existence, plunged in value after major product announcements. Data shows that shares of Apple fall on the day of an unveiling event 80% of the time.
Apple Stocks tumbled 1.7% after the launch of the iPhone 8 and iPhone X as expected but the downtrend would only last for a while. The bottom line is; the company’s stocks are tipped to rise and resume uptrend after the iPhone X becomes available on the market next month.
Though, it’s not clear just how much the stock will rise.
On Sept 7, 2016 the iPhone 7 and 7s was unveiled. Since then Apple sold more than 200 million iPhones. About 100-140 million of those were made up of the iPhone 7 and the iPhone 7s. Between the unveiling of the iPhone 7 and iPhone 8, Apple’s stock price rose from around $100 a share to nearly $150. That’s a 50% increase.
The iPhone 6s and 6s Plus keynote took place in September 2015. Between that keynote and the one in 2016, Apple managed to sell another 200 million phones but the share price was mostly flat. The iPhone 6 and 6 Plus translated to a roughly 10-15% share price increase. By all accounts though, the 6 and 6 Plus were better sellers than the 6s and 6s Plus. While the iPhone generates more than 50% of all Apple revenue, it would be misleading to say that iPhone sales are fully representative of share price surges but it does give us a guide. If the iPhone X comes out of the gate strong and sells between 60-80 million units in the next six months, it would be safe to say that you can expect a serious stock price run, an increase between 30-50%.
Google, Alphabet (NASDAQ: GOOGL) can also expect its stock to rise significantly after its most recent Google Pixel announcement.
Google announced the second generation of its Pixel smartphones, the Pixel 2 and Pixel 2XL early this month. The company is channelling a chunk of its resources into the hardware business. Google recently acquired a part of HTC for $1.1 billion to fuel its hardware ambition.