4 Stocks Saved By Apple's iPhone 5 Announcement

Includes: AAPL, AMZN, FB, NFLX, P, S
by: Brian Nichols

Apple (NASDAQ:AAPL) unveiling the new iPhone 5 is sure to result in a blockbuster product once it ships on September 21. The company made changes that I feel were necessary to take AAPL to a new level, and reach my personal $1,000 goal by February of 2013. It made changes to the performance of the phone (which we expected) but more importantly to the appearance of the phone, making it larger and easier to operate. Apple did a few other things in the process, probably not by choice, but did save the immediate performance of at least three companies, and hurt a few as well. There were several announcements that were expected, but were not announced, and in the process some CEOs get to keep their job and perhaps take a deep breath, but for how long?


Apple just monetized mobile for Facebook (NASDAQ:FB) by giving the company a larger screen for its app. Facebook had recently released a few apps with mobile ads and according to the company's CEO at the TechCrunch conference these apps were performing well. Apple's larger display will provide Facebook with the opportunity to create more revenue from paid advertising, and Facebook will be able to place more ads per page on its applications. As a result, this could lead to performance in shares of Facebook. Of course there are other issues that Facebook must address but with mobile ads Zuckerburg should definitely send Apple a "thank you note" at his earliest convenience.


Pandora (NYSE:P) is another company that should be thanking Apple, because Apple did not announce a music streaming service during its iPhone 5 presentation. Earlier this week shares of Pandora got crushed as the Wall Street Journal reported that Apple was set to announce its own music streaming service to rival Pandora. Obviously, Apple may still announce this service, as it would make sense, but at this time Pandora lives to see another day, as its stock popped after the Apple presentation only to fall as investors realized that Pandora isn't out of the woods just yet.


Netflix (NASDAQ:NFLX) has been a beaten down stock over the last 14 months as increased competition, slower growth, and declined margins have weighed heavily on the worth of the company. It has been a series of bad news for the company, as Amazon (NASDAQ:AMZN) recently announced a content deal that could challenge Netflix for its subscribers. And for the last several months rumors have spread that Apple was preparing to launch its own streaming service which would surely affect Netflix, and when combined with Amazon's service it could completely trash Netflix. However, I suppose Apple is saving this announcement for a later date, if it chooses to enter the space, and as a result will not be stealing Netflix customers at this time, which means Netflix can rest comfortably for a little bit longer.

Speaking of "saving for a later time" and "Amazon" some also believed that Apple would announce an "iPad mini". Amazon has performed very well and has controlled the small tablet space with its smaller and cheaper alternatives to the iPad, but as a consumer who owns both an iPad 2 and a Kindle Fire I can attest that the similarities between the two are far and few between. The Kindle Fire doesn't have the same selection of apps, its slower, and overall is a far inferior tablet than the iPad (in my humble opinion). With that being said there is a large market for what Amazon offers its customers with the Kindle Fire. It allows consumers the opportunity to afford a decent tablet for a cheaper price and also is appealing to those who prefer the smaller screen. But if Apple was to release an "iPad mini" for a significantly cheaper price than the original iPad, it wouldn't completely diminish Amazon's Kindle but it would surely affect Amazon's sales of its new lineup, which is also directly tied to the success of Amazon as a company.


Apple is by far the most powerful company in technology (perhaps the world), and has the ability to control the success and failures of other companies at will. Take Sprint (NYSE:S) for example, there were fears that the company was approaching bankruptcy in 2011 after several years of dismal fundamentals and zero growth, but in 2012 it has been one of the greatest success stories in the market, and all it took was the company gaining the rights to sell the iPhone to compete with AT&T (NYSE:T) and Verizon (NYSE:VZ). This upcoming iPhone release will be huge for retailers, manufacturers, and service providers that all profit from the greatness of Apple and the late Steve Jobs' vision. Over the next few months, while iPhone sales most likely break all previous records, it will be interesting to see how stocks perform; because Apple is a company with success that is so unprecedented that it not only affects Apple but also other large companies, both negatively and positively. Therefore, keep your eyes open, watch for visible trends, and stay tuned to see if Apple once again climbs higher and creates new highs following the release of this much anticipated device, and also which stocks will climb higher or trade lower due to the success of this great company.

Disclosure: I am long AAPL, S. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.