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Fitbit (FIT) Gets Reality Check From Microsoft (MSFT), Apple Inc. (AAPL)

Fitbit Inc (FIT)

Fitbit Inc  saw a drop in shares this week after Microsoft  unveiled its latest wearable fitness tracker – the Microsoft Band 2. Shares slipped by around 4.5 percent in the wake of the announcement, closing at $36.40 on Tuesday. Though Fitbit currently produces some of the most prominent wearable trackers on the market, the newest version of the Band is set to stand as a formidable rival.

Fitbit (NYSE:FIT) is Strong Against Apple (AAPL)

Fitbit trackers and the Microsoft Band 2 hold similar features. Both manage to one-up each other in some aspects and fall short in others. Much like Fitbit’s trackers, the second generation of the Band can track the quality of its user’s sleep, count the number of steps taken, and monitor changes in elevation among other things.

Rivals Threaten Fitbit’s Reign

The first Band from Microsoft didn’t have much to go on when it was first launched in 2014. Not even Microsoft had faith in its appeal when it premiered. This was made evident when the tech giant allowed AT&T to bundle the Lumia with a Fitbit tracker only a week after the first Microsoft Band was released.

This year, Microsoft upped its game by cramming a host of great features in the Band 2. It is instilled with the firm’s virtual assistant, Cortana. Along with it comes the well-backed Windows 10, and 11 sensors dedicated to monitoring many aspect its user’s physical health. While Fitbit focuses on other endeavors, comfortable with its stronghold, the likes of Microsoft and Apple work hard to expand their own stakes in the market.

One can’t keep Apple’s fitness  wearable out of the picture. The Apple Watch has grown in popularity in recent months. Though it is not wholly pushed as a fitness tracker, the Watch is well capable of acting as one through the help of third party apps. And what a great performer, too. It poses as heavy competition for Fitbit.

A Tracker War at Fitbit’s Door

Trying to decide which of these items will appeal more to consumers depends on a whole list of factors. The most obvious, though, would be the prominent features of each device and their prices.

Much like the integration of Cortana in this year’s Band, the Apple Watch Sport has its own Siri. Both these virtual helpers allow users to perform everyday tasks. Composing texts and emails or simply checking the weather can all be done via voice command. Fitbit trackers lack any voice control features, but do offer GPS services along with the Band 2. This quality is not offered by the Apple Watch Sport.

Of course, the durability of such gadgets must come into play. In many cases, these items take on the role of wrist watches, too. “And what is the point of an unreliable wrist piece?” some consumers might ask. This factor has the Apple Watch in last place. It does a lot more than its rivals, yes, but has to be charged nightly. The Microsoft Band 2 lives up to its number, coming in at second place in terms of battery.

It is said to last up to 48 hours. Mind you, the latest Band has a host of other benefits as well, and can not be fairly ranked until its release. Fitbit trackers vary in battery life, but generally last longer than their competitors. The Fitbit Charge HR can last up to 5 days on a single power-up. This makes the firm’s products the most favorable in terms of lifespan.

Price wise, Fitbit’s top end product – the Surge – will set you back $249. The Flex, Fitbit’s low-end tracker, is $99.95. The Apple Watch starts from $349 while the Band 2 costs $249.95, keeping in steady par with the Surge.

Other aspects, like visual appeal, ultimately boil down to consumer preference. Apple Watches come with replaceable bands, for instance. Fitbit offers a range of trackers which come in a varied forms and prices to suit its consumers. The Apple Watch and Fitbit’s trackers are available for purchase online and at select retailers. Launched this week, pre-orders for the Microsoft Band 2 are now open. The device hits stores on the 30th of October.

Fitbit Investors Step Back to Reality

In the wake of its recent share fall, analysts from the Wall Street Daily have dubbed the firm as yet another “one-product wonder”. Such entities, like BlackBerry and the recently labeled GoPro, always seem to be great investments at the start. However, “reality” soon sets in as the need to adapt and expand comes into play. One-product wonders fail to see this need and hold on to single idea.

The increased rivalry in the wearables market means bad news for Fitbit, analysts say. Emerging and diversifying firms have made it harder to grow within the industry. With the likes of Apple, Microsoft, and Garmin upping their stakes, the fitness company can’t afford to stay complacent.

It was the usual hype over new stock which pushed share prices when Fitbit opened itself in June. This led the firm’s stock to peak at $51.90 in August. Now that the excitement has faded, reality will hit Fitbit, and its shares, hard.

Fitbit  is a lot like GoPro, the outlet comments. The action lifestyle camera maker has seen falls in shares and popularity due to its rigid behavior in recent months. Though Fitbit is worse off. This is the belief of Wall Steet analyst Louis Basenese, who says the entity stands to pass GoPro on its way to the bottom. “I’m convinced that Fitbit could just as easily beat GoPro to it,” says Basenese.

“Fitbit is treading down the same rocky path: Its future holds higher expenses and lower margins, which is nothing but a negative for share prices,” says the Wall Street Daily.

Further, it is predicted that Fitbit will face more hardships in the near short-term. “Slowing growth, shrinking margins, no pricing power, increased competition, and eventual obsolescence all loom on the horizon.”

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