Apple iPhone 14 Goes on Sale Friday. Why You Shouldn’t Sell the Stock.

Text size

Apple

users are getting ready for Sept. 16, when the new iPhone 14 and iPhone 14 plus get released to the public. And while shoppers buy, shareholders should get ready for a boost.

Apple

(ticker: AAPL) unveiled a new line of products earlier this month, including the newest model of the iPhone. The iPhone 14 is available in a larger size than other iPhone models, has supposedly the best battery life of prior iPhones, and an improved camera. Notably, pricing for the iPhone 14 starts at $799 while the iPhone 14 plus starts at $899, which hasn’t increased from the price of the iPhone 13 in U.S. markets.

So what does the release of a new iPhone have to do with the company’s stock?

Historically, Apple’s stock price doesn’t do much on an iPhone-release day, gaining less than 1%. However, going all of the way back to the release of the first iPhone, Apple’s stock price has gained on average 1.6% one month after the release of the new iPhone, and that number continued to climb, according to Dow Jones Market Data. The stock climbed 3.5% on average in the three months after the iPhone releases, and rose 14% six months after the releases.

---

Newsletter Sign-up

The Barron’s Daily

A morning briefing on what you need to know in the day ahead, including exclusive commentary from Barron’s and MarketWatch writers.

---

Phone sales are important to Apple. In its latest quarter, Apple reported iPhone sales of $40.7 billion, which was almost half of the total quarterly revenue of $83 billion for the company.

And users are eager to get their hands on the phone. Despite ongoing macroeconomic issues such as record-high inflation, Wedbush analyst Daniel Ives wrote in a recent research note that “the initial order for 90 million iPhone 14 units out of the gates with Asian suppliers has stayed firm based on our recent checks and will be roughly flat with iPhone 13 despite the macro storm clouds building.”

“This speaks to the underlying demand story that Apple anticipates for this next iPhone release with our estimates that 240 million of 1 billion iPhone users worldwide have not upgraded their phones in over three and a half years,” Ives added.

Apple stock could use a boost. Shares have struggled after key inflation data showed prices are still too high for the Federal Reserve’s liking. Shares have fallen 13% so far this year, and are down 0.9% Thursday while the

S&P 500
was 0.2% in the red.

Write to Angela Palumbo at [email protected]