Our Theme of Apple Component Supplier Stocks, which includes a diverse set of companies that supply components for Apple’s iconic iDevices, has fared relatively well this year rising by about 16%. While the theme had a difficult 2022, due to supply chain constraints, and stringent Covid-19 restrictions in China, things appear to be looking up. China has rolled back its zero-Covid policy and investors are also increasing allocation to technology stocks once again, as inflation cools and the pace of the Federal Reserve’s interest rate hikes eases.
There could be a couple of other tailwinds as well for Apple suppliers. Apple is poised to launch a new mixed-reality headset sometime this year. The headset is likely to be Apple’s first all-new product line in over six years. While details of the product and its potential components remain scarce, it should benefit select suppliers. Moreover, Apple’s next-generation iPhone, presumably called the iPhone 15, is likely to feature more pronounced updates. There are expectations that Apple will raise prices on the flagship variants of the device, after essentially keeping prices flat for about six years. This could benefit Apple’s suppliers to an extent.
Within our theme, Cirrus Logic (NASDAQ:CRUS), a company that supplies Apple with audio processors, has been the strongest performer with its stock rising by about 43% year-to-date. Other semiconductor-focused vendors also fared well. For instance, Qualcomm (NASDAQ:QCOM) stock has gained about 11% year-to-date. On the other side, Corning (NYSE:GLW), the company which supplies Apple with glass for its touchscreens, has been the weakest performer with its stock up by just about 1% year-to-date.
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| Returns | Mar 2023 MTD [1] |
2023 YTD [1] |
2017-23 Total [2] |
| QCOM Return | -1% | 11% | 87% |
| S&P 500 Return | -1% | 3% | 76% |
| Trefis Multi-Strategy Portfolio | -4% | 3% | 225% |
[1] Month-to-date and year-to-date as of 3/23/2023
[2] Cumulative total returns since the end of 2016
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
