Apple’s recent launch of the iPhone 6, the latest version of its popular smartphone, could mean big changes for the tech industry. Investors are watching the new iPhone intently to see whether it–and Apple itself–is a strong investment.
iPhone 6 Demand Should Remain High
One of the primary reasons to invest in iPhone 6 is that the demand was high before the phone went on sale and continues to be high. This means that stock in Apple and in the phone itself should continue to rise steadily.
Upon iPhone 6’s launch, lines to get into Apple stores around the world literally stretched for blocks, and hundreds of people raced to be the first to get the new phone. iPhone demand should remain high because it isn’t just consumers who want to get the phone. App developers also are eager to purchase the new iPhone so that they can begin creating and selling apps that are compatible with it.
Stock in Component Companies Should Skyrocket
According to Fox Business, Apple is far from the only company that will benefit from record sales of the iPhone. Apple uses a variety of components to build its products, and each of the companies that produce the components stand to make a lot of money from the sale of the phone. Investors should pay careful attention to component companies when considering their investment decisions. Although the iPhone 6 demand may wane, companies that make components can use their involvement in the project as a jumping-off point to get involved in other high-tech products, thus keeping their stocks high.
Component companies to consider include:
- Semiconductor companies, like Qualcomm, Skyworks Solutions and Avago Technologies
- Touch screen manufacturers, like Texas Instruments
- WiFi and Bluetooth component manufacturers, like Broadcom.
Fox Business predicts that SK Hynix is one of the strongest component companies to watch and potentially invest in. Since Apple offers three different models, SK Hynix’s semiconductors will be in high demand.
Avoid Investing in GT Advanced Technologies
Although most component manufacturers and Apple itself are good investments, there’s one you should avoid: GT Advanced Technologies. For months before the iPhone 6 was released, there was speculation that GT would supply sapphire-based screens for the new iPhone. These screens were supposed to help reduce the risk of the screen shattering if a user accidentally dropped the phone as well as protecting the screens against being scratched. Despite this advantage and all the hype, Apple chose not to use GT’s sapphire screens. Thus, GT’s stock has plummeted.
Some investors are holding onto their GT stock, speculating that it will rise again when the Apple Watch, a smartphone-like watch that allows people to access the Internet, send emails and check the weather, is released. The Apple Watch is supposed to use GT Advanced Technologies’ sapphire screens; however, the release is far off and customer demand is not expected to be high for it, so this arrangement may not represent a particularly good investment. In any event, GT Advanced Technologies’ stock is not doing well at the moment because of the company’s non-involvement with the iPhone and cannot be expected to recover any time soon.
Apple products are generally a strong investment, and the iPhone 6 is no exception. Demand has already far exceeded supply in the United States, driving the iPhone’s value up higher, and Apple’s net worth should also rise as a result. Many of the individual component companies involved in the building of the iPhone may also rise in value; there is only one component company, GT Advanced Technologies, to avoid if investors want to make money.