“When Apple (AAPL) unveils its latest iPad and iPad mini later this month, the Internet will not explode, as it did when the company launched new iPhones last month,” Mark Glassman writes for Businessweek. “That’s fair enough. The iPhone is Apple’s benchmark product. It accounts for half the company’s revenue. It commands more news coverage than any other mobile device. It’s Hannah’s phone on Girls.”
“Investors, however, should not ignore the iPad. The device is a critical piece of Apple’s business, and the company’s fortunes hinge largely on the success of the latest models,” Glassman writes. “As a business unit, the iPad is huge. The device accounted for $31 billion in revenue in Apple’s most recent fiscal year. That’s more than the annual sales of 84 percent of members of the Standard & Poor’s 500-stock index.”
Glassman writes, “Here’s where investors should start paying attention. By at least one measure, as the iPad goes, so goes Apple stock. Quarterly iPad revenue has a 68 percent correlation with Apple’s share price. That’s higher than the stock’s correlations to iPhone revenue (62 percent) or Mac revenue (40 percent).”
Read more in the full article here.