Apple Inc. (AAPL) Stock: How Should You Trade Around iPhone Releases?


Apple Inc. will introduce the iPhone 7 in just a few weeks. The launch of the upcoming iPhone is essential for the Cupertino-based firm because its sales are in decline, and it is not certain how the tech giant will get some relief until 2017 – the time when Apple is expected to come with a much better iPhone.

Apple Inc (AAPL) iPhone

Now, a big question in the investor’s mind is whether they should buy the Apple stock and hope for profits as sales of the iPhone 7 and next year’s iPhone model kick in? Or has the stock already reached its height, meaning the investor should sell now before the things get wrong.

History – what it tells us about Apple stock behavior?

Last week, Apple Inc. stock closed at $108.18. Apple’s stock started this year at about $105, therefore, its performance year-to-date has basically been flat, and not almost expected.

Business Insider looked at Apple’s stock price for all iPhone releases- from the iPhone 4s onwards, and calculated whether the release of an iPhone is good or bad for the stock, if a person bought it on the day the new phone was launched, and held it until the day of the launch of the next model of the iPhone, probably a year later.

As per BI, the value of the stock was $55.19 when the iPhone 4s was released on October 14, 2011; the stock was at $91.96 (up by 67%) when the iPhone 5 was launched on September 21, 2012; the value of was $62.86 (down by 32%) when the iPhone 5s was released on Sept 20, 2013 and its value was $97.19 (up by 55%) when iPhone 6 was released on Sept 19, 2014. Last year, the stock’s value was $112.31 (up by 16%) when the iPhone 6s was released on Sept 25.

“The numbers show that the launch of a new iPhone is not a solid guide to the direction of AAPL afterward. Although the stock generally rises, it lost 32% of its value in the year after iPhone 5 and gained only 16% after iPhone 6s. From that launch until today AAPL has given up another 4%,” notes BI.

Profits are in holding the stock for long-term

Usually, Apple’s stock rises nicely, and it has gained around double of its value since the iPhone 4s. Overall, based on the past, it can be said that attempting to “time” Apple stock is a risky bet; the real profits are when you hold the stock for the long-term.

In separate news, it looks like AT&T will sell the iPhone 7 starting September 23 in retail stores, notes a report from 9to5Mac. As per a leaked photo (titled ‘Upcoming Merchandising Reset Hours’), September 23 is the only scheduled reset after September 9. Apple Inc. , generally, releases its new iPhones around two weeks after it discloses them. Other carriers will have the same dates lined up as well for the preorders and release of the iPhone 7 if this leaked schedule from AT&T is legitimate.

Disclaimer: The above should not be considered or construed as individualized or specific investment advice. Do your own research and consult a professional, if necessary, before making investment decisions.

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    Aman is MBA (Finance) with an experience on both marketing and Finance side. He has work as a Risk Analyst for AIR Worldwide, and is currently leading VeRa FinServ, a Financial Research firm. Favorite pastimes include watching science fiction movies, playing PC games and cricket.


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