Last week’s speculation that Apple (NASDAQ:AAPL) was working on designing a Bluetooth smart watch alongside Intel (NASDAQ:INTC) has received backing from Piper Jaffray’s Gene Munster. The analyst wrote in a note on Wednesday that Apple’s entry into wearable computing may even lead to a device that ultimately replaces the iPhone.
What’s the Watch Buzz?
“We note that recent speculation from tech blogs suggests that Apple may launch a watch as a companion device to the iPhone,” Munster wrote. “While we are unsure of the ultimate launch timing (likely 2014 or later), we believe that Apple will eventually introduce some type of wearable computing product. As we have previously noted, we believe that wearable computers will ultimately be a major future trend.”
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Muster added that he expected Apple to profit from the trend by not only creating new products for its consumers but also expanding its MFi program that allows hardware manufacturers to create products that connect to iOS devices.
CHEAT SHEET Analysis: High-Quality Product Pipeline for Future Good News
One of the core components of our CHEAT SHEET investing framework focuses on new products being planned that will, in the future, affect the company’s sales and revenues. A breakthrough product that provides a new spark to Apple’s future and its stock market fortune is being highly awaited by investors. According to the analyst, wearable devices may eventually even end up replacing smartphones and tablets, especially in markets where price is a big factor in adoption.
“We believe technology could progress to a point where consumers have a tablet plus wearable computers, like watches or glasses, that enable simple things like voice calls, texting, quick searches, navigation, etc. through voice control,” Munster wrote. “Longer term, screens in glasses or projectors could replace the necessity of a screen from a smartphone or tablet. These devices are likely to be cheaper than an iPhone and could ultimately be Apple’s best answer to addressing emerging markets.”
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