This week could be a landmark time for technology bellwether Apple (NASDAQ:AAPL). The Company is slated to announce a series of key product introductions on Wednesday, September 9th in San Francisco that will serve to either keep the sellers at bay or be a non-event.
As it did last year, Apple will introduce its latest iPhone, the 6S. to much fanfare. New features include a bigger screen (so we hear), an enhanced camera, more advanced touch screen, and other cool features. There is always a buzz around the latest iPhone and it will be interesting to see what level of pre-ordering takes place this year. That data alone may tell the tale of the Company’s stock in the near term.
Separately, by all accounts investors should receive an update on Apple TV’s progress and new approach which emphasizes streaming TV and gaming. Is Apple really taking on the console makers? For all the iPhone hoopla, this next generation Apple TV, with Siri capabilities could really be an interesting business driver next year.
Finally, Apple plans to introduce a new iPad to combat sluggish sales. Frankly, with tablet growth and usage waning industry-wide, investors are likely to see more sales growth from Apple’s phones and even watches next year! So, investors in Apple’s stock may not wish to take much stock in iPad growth, growing forward.
With the Wednesday event likely to take some pressure off of the stock and management for the near term, the Street is asking itself, what is the true valuation for these shares? If new iPhone sales are brisk, Apple watch sales make headway and the Apple TV initiative wins early adopters, perhaps 14x next year’s earnings is a reasonable expectation. That equates to a stock in the $140’s, nice 25% pick-up from current levels.