Apple Stock News: Apple’s Revenue Hits An All Time High

Summary:

  • Apple’s Services Revenue Reaches New All-Time High of $11.5 Billion
  • The U.S. Supreme Court ruled that consumers can press ahead with a lawsuit that accuses Apple (AAPL) of using its market dominance to artificially inflate prices at its App Store.
  • Apple’s market share in the global smartphone market is shrinking.

Sticky Situation For Apple

The U.S. Supreme Court ruled that consumers can press ahead with a lawsuit that accuses Apple (AAPL) of using its market dominance to artificially inflate prices at its App Store. The US Supreme Court voted 5-to-4 to allow an antitrust lawsuit against the tech giant to move forward. This decision piles on the pressure the company faces to cut the 30% commission it charges on app sales. Lawyers pressing the case plan to seek hundreds of millions of dollars on behalf of overpaying consumers. Apple fell 5.8% to close at $185.72 on the stock market on that day.

[Yahoo finance]

When a user buys an app on Apple’s app store, Apple collects the money, keeps the 30% commission and gives the rest to the developer. Apple told the high court it passed $26.5 billion on to developers in 2017. The company is part of an app economy that will grow from $82 billion last year to $157 billion in 2022, according to App Annie projections.

In the Apple lawsuit, the company argued the case’s focus was the 30% commission. That’s something the company said is paid by the developers, not the app purchasers. The consumers said they pay for the commissions through higher app prices. But Apple contends those are the type of “pass-through” damages barred under the Supreme Court’s 1977 Illinois Brick v. Illinois ruling. The high court did not touch on the merits of the case, which contends the company has monopoly power over iPhone users because the only place they can buy those apps legally is run by the company.

Shrinking Problem

Apple’s market share in the global smartphone market is shrinking, and the company’s margins are being compressed due to declining iPhone sales and increased competition. This leads me to believe that Apple will likely have to lower iPhone prices to better compete with its cheaper competitors.

In addition, the recent earnings report was not great in my view, and the company may disappoint investors in future quarters. The technical image also looks weak, and we could see another 15-20% correction from here. Between Q4’18 and Q1’19, Samsung has taken a 5% leap in the smartphone market share, while Apple declined by 7%. Huawei has since overtaken Apple in second place.

[Statista]

Trade War

[Financial Times]

In the ongoing trade war between US and China, tariffs of 25% on $200 billion of chinese goods were made on the 13th May. The tariffs could add about $160 to the cost of a $999 Chinese-made iPhone XS. The increased cost of the american branded chinese made product could have detrimental effects on the sales of its products, with strong competition coming from Samsung and Huawei. However, one thing to note about the tariffs is, the cost of the tariffs to consumers. The new 25% tariff is levied on components, not the finished product. Apple’s AirPods and Apple Watches are spared additional tariffs. Any calculations made pertaining to the costs will not be straightforward.

Although Apple has a lot of American suppliers and spent $60 billion on American suppliers in 2018, it assembles its iPhones primarily in China. As a result, Apple uses a Chinese supply chain for all its products, from iPhones to iPads and Mac computers, hence being a primary victim of the trade war. It’s korean competitor, Samsung which has plants in Vietnam, China, India, Brazil, Indonesia and Korea, is far more diversified in its supply chain. To address this issue, Apple has reportedly stepped up efforts to shift production from China.

Shipments of iPhones to North America, Apple’s largest market, fell 19% to 14.6 million units in the first three months of the year. Also, Tariffs could also affect iPhone sales in China, where On Monday, China announced plans to apply 25% duties on 2,493 US products, starting on 1 June. Apple reported $51 billion in revenue in 2018 from “Greater China,” which includes Hong Kong and Taiwan. That’s Apple’s third-biggest region, after the Americas and Europe. Apple’s total revenue for 2018 was $265.6 billion. This could mean a lower revenue in the future quarters.

Everything else is thriving

[Idgesg.net]

Even though Apple has faced legal troubles and the potential force of the trade war, investors should not worry. Apple is doing well in services, that its service revenue has increased to $11.5 billion in the Q2 2019 financial report. That can be attributed to paid subscriptions, which nearly topped 400 million for an increase of 30 million over last quarter. The company also posted quarterly revenue of $58 billion , which is a decline of 5 percent from the year-ago quarter, and quarterly earnings per diluted share of $2.46, down 10 percent.

International sales accounted for 61 percent of the quarter’s revenue. iPad sales were also up, fueled by the release of the fifth-gen iPad mini and the new iPad Air. Apple also sold $5.1 billion worth of Apple Watches, AirPods, and other accessories in the Q2’19, a 30 percent increase over the year-ago quarter. We should also not forget that Apple announced that they will no longer reports iPhone, iPad, and Mac unit sales numbers.

Apple Stock Outlook For 2019: SWOT Analysis + I Know First Forecast For AAPL

Apple Stock Outlook For 2019: SWOT Analysis + I Know First Forecast For AAPL

The infamous Apple logo

Apple (NASDAQ:AAPL) has come a long way over the past few years. As it has doubled its stock price since summer 2016 and become the first trillion dollar company earlier this year, it has also seen some dips and is currently below the price it was at a year ago.

 

Apple is now down 33% from it’s all time high of 233.47 and has dropped below the trillion dollar mark once again. Apple’s most recent tumble has left the company at a new 2018 low ~$150 on December 21 causing market cap to drop below $700 billion for the first time in nearly 2 years. So what’s next for the company for the next year? Will the stock price continue to slump as it has for the tail end of 2018? Or will it bounce back for another record breaking year? In this article, we will take a look at Apple’s strengths, weaknesses, opportunities, and threats in order to determine the tech giant’s future potential.

SWOT Analysis

Strengths

Apple has many strengths that have helped it stay on top of the phone and computer market for years. It’s simple and easy to use iOS phone software compatibility with its macOS computer software has allowed consumers to maintain seamless connections between their phones and computers. This has contributed to the large brand loyalty customers feels towards Apple. Many iPhone users have used the flagship phone for years and do not plan on switching anytime soon.

Moreover, Apple has boasted strong financials over the past years with strong quarterly reports. While some investors were not necessarily thrilled with the company’s latest Q4 earnings report, there were still many impressive metrics such as a 20% YoY increase in revenue to $62.9 billion. This translated to an extraordinary 41% YoY increase in earnings per share of $2.91. These high percentages resonate more with those of a startup than the multibillion dollar company Apple has become.

Source: Yahoo Finance

These high revenues have given the company high cash flow it can invest as it chooses. The company has put a large focus on research and development of its current products as well as new ventures. For example, the company releases new iterations of its phones, computers, and watches yearly. On top of that, the company has been working on new applications of its technology such as self-driving cars. In the past, Apple has created innovative products that have helped attract and maintain customers.

Apple Annual Free Cash Flow (Source: MacroTrends)

Despite being a multibillion dollar company, Apple still have a relatively fair valuation. The company’s Price/Earnings Ratio is cheaper than the industry average which sits around 20. This is also very valid considering it also has a very reasonable forward P/E of 11.85. Additionally, Apple’s earnings growth doesn’t seem to be stopping. Over the past 5 years, EPS growth has been around 15%. Over the next 2 years, EPS is expected to grow by a slightly lower, but still significant 11.10%.

Weaknesses

While Apple did have a strong start to the year, it struggled in the final quarter of the year. Despite announcing three new iPhone models in September, the company did not meet expectations for unit sales. While this would have been disheartening, but not necessarily worrisome on its own, Apple also announced it would no longer release metrics for hardware unit sales. To many investors, this implied a slowdown of sales and potentially a dip into negatives.

One of the most unique features of the iPhone XR is the new color ways available. Although some of these colors were also available for Apple’s last budget phone, the iPhone 5C (Source: Apple)

So why exactly have iPhone sales been down? With improvements in the technology within smartphones, they now last longer and consumers do not necessarily need one every year or two. Additionally, the latest iteration of iPhones were extremely similar to the previous generation, leading few people with newer phones to upgrade. In the past, the new features of the most recent iPhone might still incentivize those with functioning phones to take the plunge for the news phone, now only those who are in need of new phone will invest. Additionally, the high price of the iPhone XS and iPhone XS Max may be a pinnacle for Apple’s pricing power. Even the company’s cheaper option, the iPhone XR, sells for a premium of $749. The higher prices for fewer new features has led consumers to use their phones for longer and hold off on upgrading, decreasing hardware sales.

On January 2, Apple released a press release outlining a revised lower guidance for the upcoming quarter. This sent the Apple stock tumbling as investors began worrying about these lower earnings. Apple cited four primary reasons for the decreased expectations: launch timing, foreign exchange conversions, supply constraints, and difficulty in emerging markets. The most significant weakness to Apple is the lack of revenue from iPhones which the company attributes to the timing of its launch. Because of the delay in the iPhone X, many of the orders were fulfilled in Q1 2018 whereas the majority of iPhone sales were fulfilled in Q4 2018 for the iPhone XS, iPhone XS Max, and iPhone XR. This in combination with supply constraints urged Apple to warn its investors of lower potential revenue for the first quarter of 2019.

Opportunities

While iPhones still represent Apple’s core business, Apple has been diversifying its revenue by focusing on its services. While buying an iPhone or other Apple hardware product happens at most once a year, services can be purchased at anytime with higher frequency. Apple’s Services division is composed of many different services ranging from AppleCare, Apple Pay, Apple Music, and more. In its most recent quarter, Services revenue increased 17% YoY to nearly $10 billion. If Apple continues to focus on the Services market, it can reap large profits.

Apple also recently teamed up with Amazon to form a lucrative new partnership. Amazon will now be a direct reseller of Apple iPhones and iPads. This should help to boost hardware sales and sets the stage for future partnerships with Amazon which should prove profitable for Apple. This partnership also allows Apple the chance to capitalize on another opportunity: holiday sales. The holiday season has high potential to increase hardware sales.

Another potential, but less likely partnership may be with Tesla. Many analysts have noted that the companies similar emphasis on seamless software and sleek hardware could lead to either an acquisition or partnership. While there has been no indication from either company that this is in the works, it would be logical considering Apple’s work on self driving cars and Tesla’s need for free cash flow.

Apple has struggled in the past with developing markets such as in India. The expensive iPhone has not had the massive success it has in other countries because of many lower price alternatives from competitors. Additionally, high tariffs have made the phones come at an even higher premium. Apple began combatting this by starting to assemble iPhones such as the SE and 6S in 2017 through Wistron’s local unit in Bengaluru. Apple has now struck a deal with Foxconn to being manufacturing its newer iPhones such as the iPhone X in the beginning of 2019. Until now the company has only sold is lower end models, so the introduction of new premium phones will hopefully grow Apple’s prominence in the country.  This partnership has massive potential to help Apple gain market share in the huge Indian phone market.

Threats

Source: Pixabay

In December, the US market officially entered bear territory, just like Apple itself. Many stocks are struggling in December, one of the usually most profitable months for companies. As one of the biggest stocks in the US stock market, Apple can be affected by general market sentiment and trends like this December dip. With many analysts wary of an oncoming recession, Apple could suffer from no fault of its own.

Another potential threat Apple faces is an escalating US-China trade war. Just like the entire technology sector, Apple is susceptible to impacts from tariffs. Additionally, Apple faces pressure to move production to US which would lead to higher costs for Apple. Meanwhile, China has proposed various policies from closing its markets which would affect many Apple suppliers. On top of this, Apple is currently appealing an iPhone sales ban in China and Germany on older iPhone models over patent infringements of Qualcomm. A Chinese court has banned imports and sales of iPhones comprising approximately 10-15% of  Apple’s China sales. However, Apple will continue selling its iPhone 7 and 8 models on the website while the decision is appealed.

The trade war is not the only difficulty Apple is facing in regards to international expansion. Another major player in Apple’s lower revenue guidance was difficulty in emerging markets and significantly lower iPhone sales in China. As a whole, China’s economy has been slowing down since the middle of 2018. This economic slowdown was only exacerbated by trade tensions leading to a large contraction in the smartphone market that affected Apple and created a revenue shortfall. Apple also overestimated the number of upgrades in these emerging markets which is a result of a strong US dollar, fewer subsidies, and phones now function at a high capacity for much longer than they used to. Apple is already taking action to minimize the impact of these threats in the future.

Analyst Recommendations

Currently, the majority of analysts have a bullish outlook for AAPL. Of the 42 analysts polled by Yahoo Finance, 31 rate Apple stock as a Buy with 11 of these as Strong Buy. Only 11 of the analysts give Apple a neutral rating.

Conclusion

Despite lowered earnings expectations, which has been a very bearish signal for many investors, Apple still has potential in the new year. While Apple cannot control the macroeconomic environment that has led to this decreased guidance, the company is already combating these with new programs. For example, Apple is now incentivizing customers to upgrade their iPhone by offering larger trade in values for older models. Additionally, which iPhone sales have suffered, the largest number of iPhones are being used daily which provides a large market for Apple’s services and also exemplifies the loyalty of Apple users. The price drop that resulted from Apple’s press release now provides an even more valuable opportunity to buy into the multibillion dollar company.

While Apple does have some weaknesses to work on and threats to combat, the company has many strengths and opportunities it is building on while should outweigh the downside. That being said, as the economy sinks into bearish territory and trade war tensions continue building, the market as a whole including Apple, will probably not see any major gains. Over the long run though, Apple should bounce back. As it diversifies its revenue by taking advantage of Apple Services, the offset of decreased hardware sales will affect earnings less. Additionally, with a track record of new innovation, Apple’s next line of phones should be more unique. Moreover, no one knows what other products are in development. Based on this, Apple should be back in winning territory by the end of 2019.

I Know First 2019 Bullish Forecast For Apple

The I Know First machine learning algorithm currently has a positive outlook for AAPL. While the stock is bullish over all time horizons, it is most bullish for the 1 year period with a signal of 310.36 and predictability indicator of .85.

Past I Know First Success With Apple Stock Forecasts

A bit over a year ago, the I Know First algorithm gave a bullish long term outlook for AAPL which was included in a premium article on how the trillion dollar app economy is boosting Apple. The prediction was bearish in the short term, but saw a positive upside over the 1 year time horizon with a signal of 116.66 and a predictability indicator of .62. In accordance with the algorithm, Apple has grown nearly 45% since then.

In a Rare Move, Apple Admits to Faulty MacBook Keyboard

“Design is not just what it looks like and feels like. Design is how it works.” – Steve Jobs

(Source: Pixabay)

In 2015, Apple ditched their classic keyboard design for a new, sleeker keyboard with a “butterfly” mechanism for their MacBook and MacBook Pro line. Apple claimed this new keyboard was 40% thinner, making it much easier and fluid to type.

Consumers started reporting that the keyboard was faulty and that just a tiny bit of dust caused the keyboard to repeat letters or not respond properly. Being that these devices started at $1,299, users were mad that Apple was not making an effort to address such a fault. Three years and three lawsuits later, Apple has finally stated that they will fix the faulty butterfly keyboard, free of charge.

In other news, analyst Eric Ross of Cascend Securities stated that, iPhone’s supply chain was “healthy and growing again”. This may be due to the restocking of the iPhone X, which is selling better than expected, causing suppliers to revamp selected parts for the device. Morgan Stanley analyst Katy Huberty stated that the upcoming iPhone will be at cheaper cost as Apple looks to drop prices by 2%. So, this increase in supply may be for the new iPhone, releasing this September, which the company expects to sell greater quantities than last year.  

Apple’s stock was down .64% on Friday as an escalated fear of a trade war mounted a dip in the market.

(Source: Yahoo Finance)

Apple Stock News: A $1,000 iPhone X From Apple Will Find Many Eager Buyers

Apple Stock News

For the latest Apple Stock News, AAPL closed at $161.5 per share on September 11th, 2017. It generated a profit of 1.80% from its previous close on September 9th, 2017, when it closed at $158.63 per share.

On this Tuesday, September 12th, 2017, Apple is celebrating the 10th anniversary of the iPhone, launching its new version, in California.

Recently, a new leak revealed details about apple’s upcoming products. Therefore, according to it, the new iPhone will be called iPhone X. It might utilize “FACE ID” technology to unlock the phone, a display that covers the whole front, wireless charging, improved camera and no home button. With its price rumored to be around $1,000, the new iPhone version might be the most expensive yet sold.

The launching might also include additional products. The updated version of last year’s model:  iPhone 8 and iPhone 8 Plus, new Apple Watch, Apple TV with 4K, HomePod speakers and iOS 11 may be unveil on this Tuesday.

According to I Know First Senior Analyst Motek Moyen, in this article, investors should expect that the iPhone X will find tens of millions of buyers and that it will probably outsells the iPhone 8 and iPhone 8 Plus. Since higher prices raises the average selling prices of iPhone, Motek emphasizes that it can increase Apple’s operating margins.

Apple’s Special Event will take place at Steve Jobs Theater at 10 a.m. PDT. Hence, the market is looking forward to discovering the upcoming news from one of the world’s most valuable companies.

Keep checking back for more news regarding AAPL. For Full AAPL forecasts and investment advice by our state-of-the-art algorithm click here.

Apple Stock News: A Look Into iPhone 8

Apple Stock News

For the latest Apple Stock News, AAPL closed at $119.04 on Friday, January 13, 2017 with a 0.18% loss, or $0.21 from its previous close of $119.25 per share. AAPL stock may have dropped, but 2017 should be a bullish year for the technology company.

Apple Stock News

After Apple’s disappointing performance with iPhone 7, expectations for iPhone 8 are already circulating. Supposedly, the entire front of the new smartphone will be a screen with no home button or edges exposed. The new futuristic look would replace the traditional home button with a touch-sensitive digital button. Samsung’s popular OLED display will also be adopted in the new phone, enhancing colors at a faster rate than LED. iPhone 8 is anticipated to move into “forged steel” or “metal forging” which would result in stronger metal than the current aluminum. This pressurized metal would be clinched between a two-sided ‘all-glass look.’ Though, this is is not the first time Apple has attempted this glass casing. Last time we saw this was when iPhone 4 and 4s were introduced. The opportunities of wireless technology are also expanded due to the glass casing. Apple has reported that more wireless charging options in the iPhone should be released in 2017. Because of Apple’s 10 year anniversary, the release of the new iPhone is predicted to make a big entrance. The appearance date of the iPhone 8 may hold to tradition, in the month of September, or it may surprise consumers and be released early on June 29, marking the date the first iPhone was released.

Keep checking back for more news regarding AAPL. For Full AAPL forecasts and investment advice by our state of the art algorithm click here.

Apple Stock News: Steve Jobs – The Movie

On July 1st, the trailer for the much anticipated Steve Jobs movie was released. In it, director Danny Boyle,

Steve Jobsattempts to portray the way Steve Jobs transformed Apple (AAPL) from a small personal computer business into the world’s most valuable company in less than forty years.

The short three minute trailer has created a frenzy in both the movie and high-tech world accumulating 1.5 million views  on YouTube in less than twenty-four hours.

Michael Fassbender’s portrays portrayal of Steve Jobs has inevitably led critics to compare and contrast his portrayal with the way Jesse Eisneberg portrays Facebook’s (FB) Mark Zuckerberg in `The Social Network`. Not just because of the sheer similarities shared between their success stories, but because of the way both directors have attempted to depict the respective founders dark side too.

In the short clip (below), one can watch Jobs unveiling his three iconic products . The trailer highlights Job’s confrontations with his Apple colleagues preceding the launch of the Macintosh computers, the incident in which he was ousted from Apple by the board of directors, and the controversial way in which he and his ex-girlfriend had major disputes over the paternity of his daughter, Lisa.

The movie is set to be released on October 9th and the debate as to whether Fassbenger’s portrayal of Jobs is accurate or fair will undoubtedly follow shortly after.

AAPL News: Apple Watch Not A Big Hit, Yet

AAPL News

Since the Apple Watch was released, it has been generally perceived as the best smart watch out on the market. While this consensus still seems to be true, a survey from research firm UserTesting found that while people like the device, their reaction was not overwhelming and they wouldn’t recommend it to other people. The main issue with the device is the third-party apps, which were slower and less-reliable than built in apps.

aapl news

UserTesting used open-ended questions with 52 Apple Watch users and found that only 38% of them would recommend it to their peers. This was far from overwhelming, as users complained about the poor performance of the device and how the third party apps were mostly useless. Apple has already addressed ways to fix some of the issues at its World Wide Developers Conference last week, releasing a new operating system that allows for native apps and giving app developers more access to internal sensors and features of the watch.

While there were major issues with the Apple Watch for the users surveyed, there were some things that they liked. Step counting and fitness tracker goals were the most frequently cited as being useful, while users also identified the notifications through haptic vibration as a good feature. Michael Mace, the VP of UserTesting, said the results were not overwhelming, but were a solid start for Apple to build off of. Apple will be able to modify and build the watch based off of what is useful to users, much like they did with the iPhone in the past.

AAPL News: Advantages Apple Has In Music Streaming

AAPL News

At the World Wide Developers Conference on Monday, Apple’s biggest reveal was saved for last. The music streaming service Apple Music was finally revealed, and it will be made available to customers on June 30th. So far, the service has been met with skepticism, as analysts are unsure of whether it will be able to overtake competitors and dominate the market. Apple has some advantages over the others, however, and should be able to succeed because of them.

aapl news

The first advantage is the overall size of Apple’s music library, which is much larger than that of its rivals in the market. Apple has approximately 37 million songs in its music library, while Spotify and Google Play only have 30 million songs. Other rivals Tidal and Pandora only have 25 million and 1.5 million songs, respectively. Apple’s customer base is also huge compared to rivals, and if it can get a single digit percentage to convert to streaming, it can double the streaming market.

This is where the company’s customer loyalty and brand image will play a part. Apple’s marketing to its core customers has been extremely effective in the past. Apple customers tend to have multiple devices, including Apple computers, mobile phones, tablets, etc. Getting them to adopt the music streaming service is well within reason. Apple also has introduced a family plan, where up to six members can share an account for only an extra $5.00.

AAPL News: WWDC Starts Tomorrow

AAPL News

Apple’s annual event, the World Wide Developers Conference, starts tomorrow in San Francisco. One of the biggest stories circulating about the event before it starts is the absence of an Apple TV announcement, that is no longer expected to be revealed because the device is not ready to be shown to the public. While there will not be a new Apple TV, there is plenty to be excited about, headlined by a ramped up music service that will offer competition to rivals Spotify and Pandora.

aapl news

CEO Tim Cook is expected to reveal the new Apple Music service that will become available to iPhone users at the end of the month, and that will eventually even be offered to Android users. The service will provide streaming at a competitive cost to other services like Spotify, while Apple works to get exclusive partnerships with major labels and managers to differentiate their service. Radio will also factor heavily into the new service, complete with celebrity DJs.

Besides the music streaming service, Apple is also expected to introduce upgraded operating systems, both for its Mac computers and its mobile devices. For mobile devices, the upgrade is rumored to include the ability to run two apps on the screen at the same time. Cook will also introduce a rewards system for Apple Pay to encourage Apple users to use the service, while updates on Apple Watch apps will be given as well.

AAPL News: Apple Watch Event Indicates Clear New Strategy

AAPL News

Apple Inc. (AAPL) held its “Spring Forward” event on Monday, March 9th. The company released new details of its long-awaited Apple Watch at the event and was dubbed an Apple Watch event by many analysts. But other new products also garnered much fanfare, and these products set up Apple to increase its market value further.aapl news

The headliner of the event was the Apple Watch, and it did not disappoint. Apple CEO Tim Cook announced that the wearable device will come in two different sizes and three different models. The Apple Watch Sport will start at $349 for the 38mm version, while the 42mm version will be $349. The Apple Watch will range from $549 to $1099 depending of the wrist band, while the Apple Watch Edition will start at $10,000.

The varying price range shows Apple hopes to win over both the high and low end of the market with its new device. Basically, it hopes to be the best device someone can buy for either $349 compared to other low-end watchmakers, or compared to luxury brands like Rolex for up to $17,000. And they might be able to pull it off because of its usefulness. Simply put, the Apple Watch will make using the iPhone easier and simpler for consumers, making the technology nearly invisible.

Users will be able to make phone calls, read and send messages, and monitor their own health status, along with a large range of other functions, with their wearable device, saving them time and effort. The ability to hail an Uber at any time simply using your watch may not sound that incredible, but people might not be able to live without it after getting used to the effortless practice. The same can be said for many of the watches uses.

A perfect example will be Apple Pay, which Apple hopes will be helped by the use of the Apple Watch. The payment service is now accepted at 700,000 merchant locations, which is nearly three times the number of merchant locations it was accepted in just three months ago. Already having dubbed 2015 the year of Apple Pay, Cook affirmed this declaration at the event, as it fits into Apple’s attempt to make everyday tasks easier and simpler using its technology.

The Apple Watch makes using Apple Pay even easier than with the iPhone, as it only needs to be within a certain distance of a sensor to work. Users will no longer have to take out their phone and use a fingerprint, and it is even more speedy, convenient, and secure than before. The Apple Watch also opens up Apple Pay to earlier versions of the iPhone, not just for the iPhone 6. The seamless and easy use of this technology will assist Apple take a larger part in its consumers’ lives while not being visible.

The Apple Watch was not the only new technology revealed at the event, and the MacBook was a huge hit. Apple debuted its thinnest and lightest MacBook today, which is 24% thinner than the MacBook Air. Prices for this device start at $1,299, and some of the features are pretty remarkable. It has a 12-inch retina display and a new Force Touch touchpad that will be able to tell the difference between light taps and strong presses. The most interesting feature is its USB-C connector that supports five connection standards: USB data transfer, power, DisplayPort, HDMI, and VGA.

While the MacBook rightfully garnered lots of attention, Apple’s forays into Apple TV and Apple CarPlay are what are so promising for the company. Cook announced that every major car brand has committed to delivering CarPlay, noting that 40 different models will ship with the software this year. The in-car entertainment system is designed in house by Apple, providing a smoother, more familiar experience. This will also add to Apple’s presence in its users’ lives, adding another screen for Apple. It will also act as a precursor to Apple’s own car, which it is rumored to be working on.

Another product that Apple has been rumored to be working on is its own TV. Apple already has the Apple TV, and it announced a partnership with HBO. Customers will be able to stream the service without a cable subscription for the first time using the device, making it cheaper. These developments are important for Apple, who hopes to increase its presence in consumers’ lives.

Increasing its presence through the Apple Watch, Apple TV, and Apple Car could dramatically expand the reach of its ecosystem, decreasing the company’s reliance on sales of the iPhone. Doing so could cause the company to reach the $1 trillion marker valuation that is the company’s next target for analysts, after reaching $700 million and maintaining its value above it for weeks now. While this strategy has been rumored before, it now seems apparent that Apple hopes to be even more present in people’s lives while not being thought of, making the products indispensible to its users’ lifestyle.

Algorithmic Analysis

I Know First supplies financial services, mainly through stock forecasts via their predictive algorithm. The algorithm incorporates a 15-year database, and utilizes it to predict the flow of money across 2000 markets. The algorithm has more data to forecast within the long term and, naturally, outputs a more accurate predication in that time frame. Having said that, intraday traders, along with short-term players, will also benefit by taking the algorithmic perspective into consideration.

The I Know First algorithm was able to correctly predict the behavior of Apple’s stock over the last year. Figure 1 is an I Know First algorithm prediction made on February 21st, 2014. The self-learning algorithm uses artificial inelegance, predictive models based on artificial neural networks, and genetic algorithms to predict money movements within various markets.

The algorithm produces a forecast with a signal and a predictability indicator. The signal is the number in the middle of the box. The predictability is the number at the bottom of the box. At the top, a specific asset is identified. This format is consistent across all predictions. The middle number is indicative of strength and direction, not a price target. The bottom number, the predictability, signifies a confidence level.

In this forecast, Apple had a signal strength of 1.83 and a predictability indicator of 0.3 for the one-year time horizon. In accordance with the algorithm’s prediction, the stock price increased 73.89% over that time.

aapl news

Having demonstrated how I Know First’s algorithm was able to correctly predict the movement of Apple’s stock price earlier in the article, it is worthwhile to see if the algorithm agrees with the bullish fundamental analysis of the company. Figure 2 includes the three-month and one-year forecasts for Apple from March 10th, 2015. In both forecasts, Apple has a positive signal, indicating the algorithm is bullish for the stock.

aapl news

 

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