Apple's Big Day - Why We Care
Apple's annual event in September is often filled with product surprises, celebrities and news that can move the shares of the world's most valuable company.
1. A Primer on Apple's Live September Event
Apple (NASDAQ:AAPL) is notoriously secretive about its live events and the one set for September 9th is no exception. For the first time the company is expected to host the event at the Bill Graham Civic Auditorium which holds 6,000. This was first reported by 9to5Mac. The venue is larger than the Flint Center which was the location of last year's event promoting speculation of a major announcement. So far Apple has been tight lipped with the exception of the invitation on the company's website, "Hey Siri, give us a hint."
What we can tell you is the event begins at 1pm ET (10am PST) and you can watch it via live streaming. Last year CEO Tim Cook unveiled the iPhone 6, Apple Pay and gave folks the first glimpse at Apple Watch. This year, at the very least, investors are preparing for a refresh of the iPhone 6 and a bigger push for Apple TV.
2. The Importance of the iPhone
The iPhone is perhaps Apple's most lucrative product. In the last quarter, the company said iPhone revenues hit a record growing nearly 60% in most markets around the world including China. On Wednesday investors will be looking for fresh clues to keep that sales momentum going.
3. Apple Shares In Limbo.....
Apple shares are little changed this year trading around the $109 level even after all three of the major U.S. stock market averages fell into the red amid extreme volatility last month. Investors will be paying close attention to Wednesday's event as a potential catalyst to buy the shares, which are down from an all-time high of $134 and change reached last April. Apple remains the world's most valuable company with a market cap of $600 billion.
4. How Apple Can Sway the Market
Apple is among the world's most owned stocks for institutions and individuals. That helps underscore its power as a market mover, as does its weight in the Nasdaq 100 Index. The stock represents about 14% of the Nasdaq 100 nearly twice the weighting of the second largest component which is Microsoft (NASDAQ:MSFT).
Investors often track performance using popular exchange traded funds including the PowerShares QQQ (NASDAQ:QQQ) which represents about $36 billion in assets. Over the past three months the Nasdaq 100 has fallen less than Apple's 15% drop.
5. Apple Rattles Netflix Nerves
It has been a rough week for Netflix (NASDAQ:NFLX) the shares have slipped for six straight trading sessions closing Friday below the $100 level. Apple may be ready to announce a push into the original programming business to compete with Netflix according to Variety. Details could emerge during Apple's Wednesday event. Even with the drop, Netflix shares have gained more than 100% this year and remain the top performer in the S&P 500 Index this year.
6. Apple's Star Power
Apple's power as an innovator is not lost on some of the world's biggest celebrities, especially when it comes to the power of iTunes and potentially Apple Music, which launched in 100 countries in June. Although in its early days, investors will be listening for an update on the initiative.
They'll also be anticipating the entertainment. Last year's surprise musical guest was Irish rock band U2. Adding a little star power to product events was a touch that began under Steve Jobs, who favored musicians such as John Mayer. In the end, many Apple devotees viewed Jobs as the real star before his untimely death in 2011.
