The Dow Jones Market Data team have tracked Apple’s stock around every iPhone release and found that the stock has declined an average of 0.1% on the day new iPhones are announced. On launch day, shares slip another 0.1% on average. During the week after launch, Apple slightly underperforms the market.
Day traders are free to short the iPhone launch, but everyone else should go long — way long.
Six months out from iPhone releases, Apple stock has returned an average of 11.7%, eight percentage points better than the S&P 500 index. All told, Apple has returned an annualized 26% over the past decade, a whopping 15 points ahead of the large-cap index.
All of this confirms what I’ve observed for years: Wall Street talks down new iPhones and then rushes to catch up with the reality that consumers still love them. Somehow, the market’s largest company remains one of its most underestimated.
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