It's why he had the audacity to purchase $14 billion in AAPL shares over a recent two-week period. I'd like to make the case that Cook is acting like a confident CEO for good reason. Investors and analysts may have written off iWatch as a niche product incapable of moving the needle but Cook knows better.
This is his moment to become an icon. Everything we hear from the supply chain confirms that iWatch is on track for a fall release. Here are 10 reasons why investors should own every share of Apple stock they can get their hands on ahead of the iWatch launch:
1. The Innovation Premium. Wall Street has never seen a wearable tech device go mainstream. They have no idea what to expect. If Apple can turn the iWatch into a "must have" product it will become the stock story of the decade because of its sub-$300 price point.
We all witnessed the extrapolation of volume and profits as the PC evolved into mobile, a similar extrapolation will occur as mobile evolves into wearable. Tens of millions purchased a Mac, hundreds of millions purchased an iPhone or an iPad, billions will purchase an iWatch. Investors should brace for significant volatility in AAPL throughout 2014 and 2015.
This stock could experience $100 rallies in a day. Activist investor Carl Icahn continues to pound the table that the most important words Tim Cook uttered in the January conference call had to do with his confirmation of new product categories in 2014. This is a big deal. Icahn isn't part of Wall Street's flock. He gets it.
It's why he's investing billions. It's why he tweeted out that at Google's (GOOG) multiple, Apple should be worth $1,245. Apple investors have grown weary because it's been four years since a new product category was released. Positive uncertainty from innovation will produce insane volatility. Apple is labeled as a hyper-growth innovator, which is why the stock has lagged over the past 18 months. The tide is about to turn back in Apple's favor.
2. Medical Data. In a recent article, Fortune's Philip Elmer Dewitt commented that we might be looking at the iWatch project from the wrong angle. What if fitness data is a secondary target? What if the more important market -- the one that's ripe for disruption and big enough to warrant Apple's attention -- is health care? "Real-time triage. Long-term observation. Correlation with hospital records. With the baby boom generation about to move en masse into government-subsidized health insurance programs, nursing homes and hospice care, those are serious growth markets," he wrote.