The iphone 5S will solidify Apple's lead in the premium smartphone segment. The iphone 5C
at worst will add more choice, at best will get Apple into the mid tier market in China. 
There's more product launches on the way with potentially game changing ones.
Stock is beaten down over the last couple of days. This is a good buy.



+ Most complete mobile experience: modern look with iOS7, best app availability & functionality,
   great hardware, dead simple.

+ iPhone 5S is the best phone in the premium smartphone segment. Best in class hardware,
   a fresh new OS, best in class app availability, futuristic fingerprint tech, same price as competitors.
   Couple that with the fact that it's new, it's going to lead the pack into the holiday season.

+ Apple is just kicking off a refresh cycle that will likely include the new ipads in a month or two,
   likely a new apple TV and probably a new category product early next year.

+ Agreement with NTT Docomo which had 60 million subscribers as of March 2012. NTT Docomo
   lost about 40,800 customers in a month to rivals because of not carrying the iphone. Anyways,
   as part of the deal, Docomo has to make the iphone 40% of their sales. They sell about 3 million
   smart phones and 5 million total phones a quarter. That's between 1.2 to 2 million handsets a quarter.
   That's about 4-6% of Apple's total iphone sales last quarter.

+ China mobile deal is likely to happen soon. I am not even factoring that in at this point.

+ Stock is about 7-8% off following the announcement of the iPhone 5S and 5C.

+ Stock is undervalued by most analyst estimations.


- Premium smartphone market is saturating. Growth is in the low to mid tier where smartphones are
  replacing feature phones. Apple is getting killed here by Samsung and probably Nokia.

- Emerging markets like China and India is where the really big growth numbers are coming from.
  This growth is attributed to low to mid tier phones. Apple is being stubborn by not releasing a price
  competitive smartphone to counter the likes of Samsung and Nokia. Apple runs the risk of being
  marginalized and becoming the second mobile platform of choice as opposed to the de facto first that it is.
  This could lead to developers going Android first and spell trouble for Apple since their app ecosystem is a
  primary differentiator. This has not happened yet despite the impressive growth numbers for Android.


iPhone 5C looks to be a stellar product. It  is, essentially, an upgraded iphone 5 with a more colorful
  personality. At a lower price point it would have been a blockbuster, possibly addressing some of that
  mid end smartphone market. Why Apple chose to price it as high as they did is a tricky question.
  Tim Cook is an operations guy, he understands the situation in China, he has plenty of cash in the bank,
  knows they are losing market share, you have to figure he made a decision considering all these.
  I think the answer here is two fold:

 1) Carriers eat a bulk of the cost of the phones. They subsidize them for the customers and make money
      back on the plan. Apple was able to negotiate these prices with the carriers. They were probably able
      to also negotiate quotas. Thus the carriers will make sure to sell enough phones as the prices that work
      for the customers, while Apple gets to maintain its margins.

2) Apple doesn't want to lose their premium product halo. It's also in their DNA to make high quality products
     and that's what they want to be known for. They feel by flooding the market with a low priced offering they
     are going against this.


I am long AAPL and added to my position after writing this.