Apple Stock Price Continues to Rise despite Average iPhone 12 Sales
Apple’s iPhone 12 was one of the most awaited phones in 2020. People literally went crazy with the official launch event of iPhone 12.
Most of the investors had high hopes with iPhone 12 sales. However, the sales are not good, not bad, but average.
Maybe it is too early to count the figures. People might be waiting for Black Friday Sale to buy a new iPhone.
Even though the sales did not reach the expectations, the value of Apple stock continues to rise.
This came as a shock to various analyst and investors. It seems like there is another factor which is boosting the share prices.
Well, there are some reasons why the share prices are rising despite average sales.
People are Purchasing Pricier Models:
The main factor behind the price rise is a boost in revenue. Even though the sales are average, the revenue is quite good. It is because of the buying preference of the people.
As we know iPhone is mostly bought by the loyal Apple customers. These people are known to switch their phones with the launch of every new version.
The survey shows that these people are purchasing the costlier version of the iPhone 12. There are four models in the 12 series. While the two models are budget-friendly, the other two are very expensive.
Consumers are purchasing the most expensive models of the iPhone 12. They are purchasing either iPhone 12 Pro or iPhone 12 Pro Max. Either way, it is a good thing for Apple.
The results only show quarter 3’s performance. If the sales go with during the festive season, Apple Stock value will increase more.
Increase in Demand for New Models:
Another reason for the increase in stock price is an increase in demand for new models. Consumers are demanding more and more new models of the iPhone. More than 2,500 users buy an iPhone with a purchasing plan so that they can easily upgrade to newer models.
The demand is increasing day by day. It has increased the average selling price of the iPhone. In 2019, nearly 68% were eager to buy the new iPhone. This year, the percentage has increased to 78%.
Also, the demand for the costlier versions of iPhone has increased by 45%. If this keeps going on, Apple will make an enormous profit from the sale of the iPhone alone.
Increase in Average Selling Price:
With the launch of every new model or version, the iPhone prices keep on rising. This year the ASP is $838. In 2019, the ASP was $806.
So no matter how average the sales are iPhone will always be profitable for Apple. It is the main reason why share prices are increasing. If you want to buy this stock, you can check its balance sheet at https://www.webull.com/balance-sheet/nasdaq-aapl.
Disclaimer: The analysis information is for reference only and does not constitute an investment recommendation.