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What Does Apple's iPhone 12 Launch Mean for These ETFs?
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October 2020 will be long remembered in Apple’s (AAPL - Free Report) history due to the launch of its 5G-enabled iPhone 12 lineup. The phone is expected to be unveiled during an online-only event on Oct 13 this year with a new boxier iPad Pro-inspired look, faster processing chips and 5G wireless technology. The new phone will mark the first major revamp of the iPhone's design since 2017, when Apple introduced its $1,000 iPhone X, per an article published on cnet.com.
Wedbush analyst Daniel Ives believes that “iPhone 12 represents the most significant product cycle for Cook & Co. since iPhone 6 in 2014 and will be another defining chapter in the Apple growth story looking ahead despite a softer consumer spending environment," as quoted on the cnet article. The launch is pretty well-timed as the holiday season is just round the corner. Consumers would be eager to buy Apple’s products for their near and dear ones.
The company will also showcase new "Apple-branded over-ear headphones called the AirPods Studio, potential updates for the $299 HomePod speaker, a potential "iPhone Mini" that sits somewhere the $399 iPhone SE and $699 iPhone 11, and possibly Apple's long-rumored AirTags beacons to find lost keys", the article noted.
Apple’s Suppliers Will Benefit Too
The event could be a turning point for Apple’s suppliers too. Per a Blomberg report, Apple was already readying its suppliers to mass-produce more than 75 million of its new 5G-enabled iPhone 12 models ahead of the phone’s October launch.
In the summer of 2019, Apple suppliers were preparing components for as many as 75 million of the then-iPhone 11 handsets. The target was almost similar in 2018 when it eyed the release of the iPhone X series. This shows outstanding demand for iPhones even amid the coronavirus pandemic.
While Apple’s shares gained more than 6% on Oct 12, Apple supplier stocks, including Hon Hai Precision Industry (up 0.9% on Oct 12), Qualcomm (QCOM) (up 1.5% on Oct 12) and Taiwan Semiconductor Manufacturing Company Limited (TSM - Free Report) (up 2.4% on Oct 12, Broadcom (AVGO) (up 1.5% on Oct 12) are also gaining before the event.
ETFs to Benefit
Against this backdrop, below we highlight a few ETFs that could gain ahead.
Technology Select Sector SPDR Fund (XLK - Free Report) – Apple has 23.6% focus.
Vanguard Information Technology ETF (VGT - Free Report) ) – Apple has 21.8% focus.
Fidelity MSCI Information Technology Index ETF (FTEC - Free Report) – Apple has 21.8% focus.
iShares PHLX Semiconductor ETF (SOXX - Free Report) – Qualcomm and Broadcom have about 16% focus.
VanEck Vectors Semiconductor ETF (TSM - Free Report) – Taiwan Semiconductor has about 11% focus.
Defiance Next Gen Connectivity ETF (FIVG - Free Report) – Houses stocks that are involved in the development of, or are otherwise instrumental in the rollout of 5G networks.
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What Does Apple's iPhone 12 Launch Mean for These ETFs?
October 2020 will be long remembered in Apple’s (AAPL - Free Report) history due to the launch of its 5G-enabled iPhone 12 lineup. The phone is expected to be unveiled during an online-only event on Oct 13 this year with a new boxier iPad Pro-inspired look, faster processing chips and 5G wireless technology. The new phone will mark the first major revamp of the iPhone's design since 2017, when Apple introduced its $1,000 iPhone X, per an article published on cnet.com.
Wedbush analyst Daniel Ives believes that “iPhone 12 represents the most significant product cycle for Cook & Co. since iPhone 6 in 2014 and will be another defining chapter in the Apple growth story looking ahead despite a softer consumer spending environment," as quoted on the cnet article. The launch is pretty well-timed as the holiday season is just round the corner. Consumers would be eager to buy Apple’s products for their near and dear ones.
The company will also showcase new "Apple-branded over-ear headphones called the AirPods Studio, potential updates for the $299 HomePod speaker, a potential "iPhone Mini" that sits somewhere the $399 iPhone SE and $699 iPhone 11, and possibly Apple's long-rumored AirTags beacons to find lost keys", the article noted.
Apple’s Suppliers Will Benefit Too
The event could be a turning point for Apple’s suppliers too. Per a Blomberg report, Apple was already readying its suppliers to mass-produce more than 75 million of its new 5G-enabled iPhone 12 models ahead of the phone’s October launch.
In the summer of 2019, Apple suppliers were preparing components for as many as 75 million of the then-iPhone 11 handsets. The target was almost similar in 2018 when it eyed the release of the iPhone X series. This shows outstanding demand for iPhones even amid the coronavirus pandemic.
While Apple’s shares gained more than 6% on Oct 12, Apple supplier stocks, including Hon Hai Precision Industry (up 0.9% on Oct 12), Qualcomm (QCOM) (up 1.5% on Oct 12) and Taiwan Semiconductor Manufacturing Company Limited (TSM - Free Report) (up 2.4% on Oct 12, Broadcom (AVGO) (up 1.5% on Oct 12) are also gaining before the event.
ETFs to Benefit
Against this backdrop, below we highlight a few ETFs that could gain ahead.
Technology Select Sector SPDR Fund (XLK - Free Report) – Apple has 23.6% focus.
Vanguard Information Technology ETF (VGT - Free Report) ) – Apple has 21.8% focus.
Fidelity MSCI Information Technology Index ETF (FTEC - Free Report) – Apple has 21.8% focus.
iShares PHLX Semiconductor ETF (SOXX - Free Report) – Qualcomm and Broadcom have about 16% focus.
VanEck Vectors Semiconductor ETF (TSM - Free Report) – Taiwan Semiconductor has about 11% focus.
Defiance Next Gen Connectivity ETF (FIVG - Free Report) – Houses stocks that are involved in the development of, or are otherwise instrumental in the rollout of 5G networks.
Want key ETF info delivered straight to your inbox?
Zacks’ free Fund Newsletter will brief you on top news and analysis, as well as top-performing ETFs, each week. Get it free >>