Apple had a rough end of 2015, but 2016 might be a great year for the world’s biggest company. China, the world’s second largest economy, is one of the biggest consumers of Apple’s iPhone, and the growing Apple Pay might have found the perfect market here. China’s population is the largest in the world, and because there are so many people with iPhones in this economy, Apple Pay could be huge.
In the United States, Apple Pay has not been popular. Of all the iPhone 6 users in the U.S., only about 15 percent have used Apple Pay. Even if China shows similar percentages, they would vastly outperform the U.S. They have more Apple Pay terminals already established there than what are set up in the U.S., and the Chinese ecommerce giant—Alibaba—has already proven that epay systems can and will work. There are 350 million AliPay users here, and there were over 2 billion AliPay transaction in the second quarter of 2015. In other words, there’s a ton of potential for Apple here and they already have the framework in place to capitalize on it.
Besides Apple Pay and the iPhone, Apple has a lot to look forward to when doing business with China. They have a manufacturing section located here, and that in itself can be a cheaper way to produce these products. And because many products are made or partially made here, there is a lower cost to bring them to the Chinese population than to ship them overseas.
Because Apple’s stock is down so low right now, it has become an even bigger target for long term investors. As a short term trader, though, the path isn’t quite as clear. There were still undoubtedly be oscillations as the marketplace attempts to determine what the best price is for the company at any given moment. Also, there will be news and product releases coming from Apple. They have created a culture where product releases are a media circus, and although the general public has adjusted their trading strategy to this, there’s still a noticeable bump or dip in stock price. For starters, a recent report hinting that Apple may have cut back on production of the iPhone was more than enough to sink the stock price by more than 2 percent on Tuesday, January 5th. This happened even though there wasn’t even official confirmation that this was true at the time. Apple is forever in the public’s eye, and even false news reports can hurt it. But this will be overcome quickly as facts come to life and the true value of the company comes forth. They have one of the lowest price to earnings ratios of any major corporation, and this gives them a ton of room to safely expand stock prices without worrying stockholders of overbuying. Both traditional traders and binary options traders need to watch this so that they can time their trades right and think about how long they should keep trades open for.
Remember that the one year price target for Apple is currently $148.00. And now that the price has dropped down under $100, now is a great time to start taking a bullish stance on Apple. Yes, the company has shown some signs of struggle, but this could simply be because they grew so big so quickly over the last few years. Apple is still a strong company with strong products. They have a solid and established customer base, and international expansion beyond the iPhone is a very likely next step. Apple Pay may not be a huge cash generator, but it also has the potential to be big. Companies like PayPal, for example, are now public and independent and they do not have nearly the same product line that Apple can pull from.
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