Apple’s new iPhone 13 arrives in stores on Friday.
Courtesy Apple
New Apple iPhone models are set to be released Friday. While the launch is generally a big event for tech enthusiasts eager to wait in line for the latest gadget, traders often steer clear.
A Barron’s analysis of a decade’s worth of trading data shows that Apple (ticker: AAPL) shares have declined in the week after an iPhone release in eight of the last 10 years. Over that period, Apple shares are down an average of 0.9% during the five trading days after the release. The exceptions are 2013’s release of the iPhone 5S and 2018’s iPhone XS, when Apple shares rose 3% and 2.2%, respectively, in the five subsequent trading days.
In an e-mail to Barron’s, Wedbush analyst Dan Ives characterized the trend of traders selling Apple stock around launch as a knee-jerk reaction.
“That has and continues to be the wrong move as the skeptics fight the pure momentum and pent up demand of these upgrade cycles,” Ives said. “This [year] is no different as we believe Apple is on pace to be a $3 trillion market cap in 2022 despite the haters continuing to hate,” he adds.
Indeed, buying the dip has often paid off. Over the last 10 years, if you bought Apple stock a week after the flagship iPhone release, you’d have an average gain of 3.2% through year end. Excluding 2013 and 2018—when Apple stock actually rose around the release—brings the average gain to 5.9%.
That 2018 year actually ended up being Apple’s worst post-iPhone release performance. The stock declined 28% from the close on Sept. 20 through Dec. 31, because investors were spooked by Apple’s decision to no longer offer unit sales data for iPhones. The selloff wound up being a historic buying opportunity, though. Apple shares gained 86% in 2019, leading all gainers in the Dow Jones Industrial Average on the year.
Most tech reviewers have declared the the iPhone 13 an incremental upgrade. Still, early indicators of demand look positive. Ives estimates global pre-orders are running 20% ahead of last year’s iPhone 12 models. The iPhone 13 Mini starts at $699, while the base iPhone 13 goes for $799. The iPhone 13 Pro starts at $999, and the iPhone 13 Pro Max starts at $1,099.
Apple shares are up 0.8%, to $146.96, in Thursday afternoon trading. If the historical trend continues, expect a short-lived dip for the stock in the coming days.
Write to Connor Smith at [email protected]
