“Set to launch early this year, we expect the Apple Watch to prove a meaningful new product, adding 4% to Apple’s calendar 2015 estimated revenue and accounting for 36% of its growth (iPhone still more than 60%), but more so helping boost its price/earnings multiple as the company proves it can lead another new product category with unique competitive advantages and premium positioning that others will find tough to match,” Evercore writes for Barron’s.
“Two of the biggest hurdles for smartwatches are: 1) their small usable size; and 2) their questionable fashion style, but these two vectors are exactly where we think Apple most shines — with proven ability to develop intuitive software user interfaces and design tech products that are as fashionable as they are functional,” Evercore writes. “We think focusing on smartwatch specs misses this fashion intangible, likely the most important factor in ultimate adoption, yet we see Apple as the one company that could make smartwatches cool.”
Evercore writes, “A broader market for the Internet of Things wearables is looking to emerge, yet in many ways we think still waiting for Apple’s lead.”
Read more in the full article here.