Investors increasingly banking on profitable new product categories coming from Apple this year

Posted:
in AAPL Investors edited April 2014
Though Apple had pledged to introduce new products "throughout 2014," it has yet to have a major launch this year. That's helped set the stage for expectations among bullish investors that the company is working on something big that could truly move the needle on Apple's stock price in the coming months.

iPhone Plus
Mockup of iPhone with 4.94-inch screen, created by Marco Arment.


Options on AAPL stock relative to the Technology Select Sector SPDR Fund are at their cheapest level in more than two years, Bloomberg revealed on Thursday. And traders are said to own more bullish options than bearish ones, as investors have become hopeful that new products from Apple will reaccelerate the company's growth.

Their research found that eight of the ten most-owned contracts were bullish, while the largest open interest is on calls betting on a 9 percent increase in AAPL share prices, to $590, by April 19.

Bullish investors are particularly excited about the prospect of a new, bigger-screened iPhone model that could counter the so-called "phablet" phenomena being capitalized on by Samsung and other smartphone vendors.

Apple is also rumored to be working on a major revamp of its Apple TV-set-top box that could be unveiled as soon as this month. And there are also expectations that Apple could enter the wearable electronics market this year, potentially with a wrist-worn "iWatch."

In addition, rumors suggest that Apple will redesign its thin and light MacBook Air with a fresh look and high-resolution Retina display at some point this year.

iWatch
iWatch concept by Todd Hamilton


High expectations among investors have been partially set by Apple itself, as Chief Executive Tim Cook said a year ago that Apple would have surprises in store for customers throughout "all of 2014." With three months of 2014 now in the books, so far Apple's product introductions only involve discontinuing the iPad 2 to replace it with the return of the fourth-generation iPad, while an 8-gigabyte-capacity iPhone 5c model was introduced in some markets. But so far this year, no entirely new product models have been disclosed by the company.

And in an interview this February, Cook also said that Apple is currently working on products any "reasonable" person would consider to be new product categories. Though he didn't give any specifics about what directions the company could be headed or when those devices may launch, he did tease that Apple is planning to unveil "some really great stuff."

So far in 2014, shares of AAPL on the open market are down 3.42 percent. After big losses of more than 10 percent at the end of January following the company's quarterly report, Apple has posted gains of 5.12 percent in February and 2 percent in March to offset some of those losses, though it is still down for the calendar year.

And on Thursday, Apple announced that this year's Worldwide Developers Conference will kick off on June 2, where it is expected to announce the next-generation versions of its iOS and OS X platforms. WWDC has been held in early June for years now, so the announcement was not a surprise, and failed to move the stock higher as of premarket trading.
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Comments

  • Reply 1 of 24
    lkrupplkrupp Posts: 6,712member
    Quote:

    Originally Posted by AppleInsider View Post



    Though Apple had pledged to introduce new products "throughout 2014," it has yet to have a major launch this year. 

     

    My thoughts exactly.  WWDC puts us almost half way through the year.

  • Reply 2 of 24
    adrayvenadrayven Posts: 460member
    How is this news? they have unmeetable expectations every year. Last year it was iWatch, iTV, Larger screens.. How has this changed?

    What, even a broken watch is right twice a day mentality?
  • Reply 3 of 24
    So? The bottom line is Apple makes tons of money while everybody copies Apple, lost money and the stocks go up.
  • Reply 4 of 24
    robin huberrobin huber Posts: 3,235member
    Wall Street has been taken over by gamblers, touts, and financial criminals. The government is in their pocket. It's one thing to assume risk after due diligence when investing. It's quite another to manipulate the market to create a sure thing. At least Vegas is regulated and everyone knows the odds.
  • Reply 5 of 24
    originalgoriginalg Posts: 381member
    I think there is a lot of pressure for Apple to release new products in new categories, mainly because Tim did assert Apple is still a growth company. Current product lines are doing great, but are they enough to keep Apple's profits increasing every year? I didn't like that Tim had to use the "reasonable person" wording as a qualifier to help convince people either. It makes you think that what they have planned borders closely on their existing product line.
  • Reply 6 of 24
    saareksaarek Posts: 1,105member
    Quote:

    Originally Posted by lkrupp View Post

     

     

    My thoughts exactly.  WWDC puts us almost half way through the year.


    Well the Mac Pro was right at the end of the year. Apple doesn't tend to move quickly and are quite happy to push the time/date limits that people have in mind. So if Apple was to say tomorrow that they'd release a new Apple TV this fall, I'd take it that they would more than likely release it on December the 20th as that is the last day of Autumn as opposed to sometime in September when people expect it.

     

    So, if you tend to get upset about Apple taking forever to release an announced product just ignore the season that they have listed and expect it in the season that follows, that way your shiny new device will actually ship one day early.

  • Reply 7 of 24
    dickprinterdickprinter Posts: 1,060member

    Wait....where the picture of the purported AppleTV with the photo of House on the screen?

  • Reply 8 of 24
    Yeah, and if everyone gets what they're banking on/wishing for/crying about--a bigger iPhone, an iWatch, and a serious aTV--within a few months of each other, that'll totally pacify them for a reasonable amount of time afterwards.

    At the very best, we'll see two of these things this year. My guess is 1) an aTV with an A8 chip for gaming, an App Store, a revamped UI, and Siri integration. No cable/external media integration yet, however the new UI will set the stage for it to be added later. 2) a 4.7" iPhone, hopefully with a really innovative way to use the extra space both for app scaling and at the core OS level.

    The wearable product will come in 2015. I wouldn't be surprised if the 5.5" iPhone and the iPad Pro were never actual planned products, unless WWDC shows us some serious productivity/multitasking enhancements to iOS, in which case they'll both come out in 2015 as well.
  • Reply 9 of 24
    Fortunately for consumers, and raising the bar for Apple, the recent introductions of FireTV and Cortana — both with innovative features — will make introductions of new features in existing products and new product introductions in June a critical time in Apple history.

    Failure to meet the bar of expectation will be disastrous for the stock and leave Apple looking leaderless and far less innovative in the public eye. Technical improvements to existing products, a lá last year, won't cut it this year. There will need to be a perceptual leap forward in existing technology or a new product that can capture attention and sell.
  • Reply 10 of 24
    saareksaarek Posts: 1,105member
    Quote:

    Originally Posted by macaholic_1948 View Post



    Fortunately for consumers, and raising the bar for Apple, the recent introductions of FireTV and Cortana — both with innovative features — will make introductions of new features in existing products and new product introductions in June a critical time in Apple history.



    Failure to meet the bar of expectation will be disastrous for the stock and leave Apple looking leaderless and far less innovative in the public eye. Technical improvements to existing products, a lá last year, won't cut it this year. There will need to be a perceptual leap forward in existing technology or a new product that can capture attention and sell.

    Well, to match the features of the Fire TV they don't really have to do much. Add a channel store etc, features that they could and should have added years ago.

  • Reply 11 of 24
    I think that the ability to play games is a bit more significant than the "etc." you assign it to. There are others as well that, if Apple does not have planned or tries to slap together at the last minute, will leave ATV falling short.
  • Reply 12 of 24
    schlackschlack Posts: 683member
    wish there wasn't this false need for apple to release totally revolutionary product categories every few yrs. they are raking in amazing amounts of money and growing their existing products. shouldn't that be enough until a market need emerges that they feel they can address?
  • Reply 13 of 24
    macinthe408macinthe408 Posts: 1,050member
    Quote:

    Originally Posted by OriginalG View Post



    I think there is a lot of pressure for Apple to release new products in new categories, mainly because Tim did assert Apple is still a growth company. Current product lines are doing great, but are they enough to keep Apple's profits increasing every year? I didn't like that Tim had to use the "reasonable person" wording as a qualifier to help convince people either. It makes you think that what they have planned borders closely on their existing product line.

     

    I think it's just that people are now starting to roll their eyes every time Cook says, "We have exciting new products in the pipeline that we just can't wait to get into people's hands."

     

    The key word is 'new'. Yes, he's refreshed existing products, but what new products have come out under Cook? 

  • Reply 14 of 24
    wigbywigby Posts: 688member
    Quote:

    Originally Posted by saarek View Post

     

    Well, to match the features of the Fire TV they don't really have to do much. Add a channel store etc, features that they could and should have added years ago.


     

    Quote:

    Originally Posted by macaholic_1948 View Post



    Fortunately for consumers, and raising the bar for Apple, the recent introductions of FireTV and Cortana — both with innovative features — will make introductions of new features in existing products and new product introductions in June a critical time in Apple history.



    Failure to meet the bar of expectation will be disastrous for the stock and leave Apple looking leaderless and far less innovative in the public eye. Technical improvements to existing products, a lá last year, won't cut it this year. There will need to be a perceptual leap forward in existing technology or a new product that can capture attention and sell.

    These are not innovative as much as they are "me too" features. You see, Apple is not playing catch up to them. they re playing catch up to Apple. Apple leads in mindshare for innovations like Siri and marketshare for innovations like Apple TV. that doesn't mean they'll be fine if they sit this one out this year either. I think we're all confident that there are a few updates coming to existing products like these as well as a new product category or two. But I think they just raised the bar to about Apple's height. Now it's Apple's turn.

  • Reply 15 of 24
    lilgto64lilgto64 Posts: 1,147member
    Wait - I thought Apple was doomed since Android has taken over all but a sliver of the mobile phone market - what did I miss?
  • Reply 16 of 24
    bobschlobbobschlob Posts: 1,074member

    Awesome news.  I'll keep my eyes open, sometime around December 30-31

  • Reply 17 of 24
    saareksaarek Posts: 1,105member
    Quote:

    Originally Posted by wigby View Post

     

     

    These are not innovative as much as they are "me too" features. You see, Apple is not playing catch up to them. they re playing catch up to Apple. Apple leads in mindshare for innovations like Siri and marketshare for innovations like Apple TV. that doesn't mean they'll be fine if they sit this one out this year either. I think we're all confident that there are a few updates coming to existing products like these as well as a new product category or two. But I think they just raised the bar to about Apple's height. Now it's Apple's turn.


    In most areas I'd agree, but the Apple TV has become a stagnant mess. This is no more apparent than outside of the USA where it's support for local content is embarrassingly low. The attitude that they've shown to their international community with regards to the ATV is simply disgusting really, especially when you factor in the 25% price hike that they happily charge us.

     

    Supporting local content via a channel store would have been simple for them really and would have helped even the balance of content availability. 

     

    I'm sure that they will put some effort in and will almost certainly offer a compelling device, it's just a shame that they did not make moves sooner.

  • Reply 18 of 24
    tneelytneely Posts: 2member
    no joke. apple has been a real snoozer in 2014.
  • Reply 19 of 24
    totaltotal Posts: 83member

    what about iOS in the Car?



    Is not it something what "reasonable" person would consider to be new product categories? :)



    Maybe Tim thought this and thats all we will see this year 
    :)

  • Reply 20 of 24
    solipsismxsolipsismx Posts: 19,566member
    total wrote: »
    what about iOS in the Car?


    Is not it something what "reasonable" person would consider to be new product categories? :)


    Maybe Tim thought this and thats all we will see this year 
    :)

    It's really an extension to your current and future devices. If it's a "product" anywhere it'll be the automobile vendor that might make you get a certain package, like simply having the 7" color display wi in order to have it available but it should now be available within any iOS 7.1 device.
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