Much has been written about the new iPhone, that was not launched in the typical Apple June refresh. Most of the articles written have been rumors and speculation about what the new iPhone will look like or what technology will be included. I call this the “what” stories. They include stories that evaluate purported component manufacturer design changes to conjure up new iPhone specs such as a bigger home button, different screen sizes, etc. In the meantime, the more important question (at least from an investor standpoint) goes unaddressed.Continue reading
Despite their pivotal role in the high technology supply chain, electronic components are essentially a cyclical industry akin to older markets like steel and housing.
As with steel and home building, growth expansion requires significant skills and capital expenditures, thus additions and reductions tend to be uneven and disruptive. And, like those industries, the willingness to get caught up in trend extrapolation has a powerful allure.
Every participant in the supply chain gets caught up in the frenzy, thus the acceleration to the top and the inevitability of the cycle.Continue reading