• end investor

Apple headphone launch triggers rise in stock price


Dear Investors, Apple stock rose today by 0.5% to reach 124.38, the event was Apple’s latest headphone launch – AirPod Max, right before the holiday….errr… spending/shopping season!


Now, what is incredible is that these headphones don’t come cheap, a pair of one of these are priced at $549, way above the peers like Sony, Bose, who sell a similar product.

What is also notable is that just 2 months back, the trade pundits had predicted that Apple would only grow by about a 1% in its stock valuations over a full 12 month period, this is when the launch of AirPod max was in the offing for a few months. The investors who acted proactively and bought the Apple stock are happy about their decision, specially when the stock markets were already depressed, so it’s a double treat.


For those who missed the bus on Airpod Max, there is still juice to be had….how? Well AirPod max is the flagship product that is first in its segment of being the ‘over the ears’ headphone, plus the price point it enters the market, we should be sure there is a lot who would want one, but wont have the wallet that agrees with such a want and when this happens, we see more launched aimed at the other entry points, to gain what is a profitable business, while the demand is already created by the flagship product that acted as a product cum marketing campaign and may have never been intended to sell in volumes and make money on the volumes…..for that Apple shall have other similar products at lower price points to fill the void.


Not only apple, there shall also be others that compete with apple, who would launch their own version of the ‘over the ear’ headphone and capitalize on the marketing already done by Apple, all those stocks would be a ‘buy’ too, but thread carefully, do your research before you pick up something other than Apple. The Apple stock however overvalued in your mind, still gets a ‘buy’ recommendation from all the trade pundits, well looking at the loyal customer base, both for reasons of preferring brand over utility and reason purely egoistic/sentimental, the demand is ensured.


In any case the prediction was about a 1% rise and we have only seen 0.5% with airpod max, also these are elephants stocks and these stocks don’t gallop, nevertheless the expensive earphones have catapulted the stock up by 0.5% is no small feat, think about what would happen to the stock prices when a slew of more such product launches happen


So now is the time to add Apple to your portfolio, even if not to your gadgetry, even if you feel repelled at the price tag of airpod max! Hold it for the long haul, this stock isn’t for the short-sighted.


I am reminded of a scene from movie "The Big Short" where Brad Pitts character, a retired former trader, yes I too am not sure if such a thing exists, (Warren could not retire as yet!), warns the overenthusiastic traders betting against the American economy that they don't yet know the consequences of the scenario where they are correct about their assessment on overvaluation. Well, take it how cinema with all its creative licensing, should be taken.



Picture credit: https://www.news.com.au/technology/innovation/design/men-who-made-millions-from-global-misery-using-wifi-in-a-devon-pub/news-story/1c3a0b13e60a71dc2965d3f33201e107

4 views0 comments