eToro
By eToro
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Nexus X to boost Google stock?

All eyes have been on Apple recently as they finally unveiled their long awaited iPhone 6 and Apple Watch. But now that the Apple frenzy is winding down, it’s time to talk about the next big event in mobile tech – the upcoming release of a new Google Nexus phone.

google phone

 

Based on the latest (leaked) photos of the new phone (which will probably be called the Nexus X), it seems that the next generation of Google phones might be moving further into the spotlight and beginning to generate its own buzz. According to the latest rumors, the upcoming phone, which apparently will be manufactured by Motorola, will have a 5.2 inch display, a 2.0 GHz octa-core processor from MediaTek and a 13 mega pixel camera.

The $499.99 price tag clearly makes this one of Google’s more expensive phones and puts it that much closer, price-wise, to the coveted iPhone.

This impressive phone is sure to excite tech savvies and gadget “geeks”, but why should investors care about a Google phone, albeit a relatively impressive one? After all, the sales of the device itself are expected to make only a marginal difference in Google’s total revenue picture so why are investors excited?

Google wants Apple’s users

Although Google’s newest phone isn’t going to be released until sometime around Halloween, with specs that could possibly shadow those of the new iPhone 6, the Nexus X will certainly be no ghost. But what investors are coming to realize is that the Nexus X is a tool that will allow Google to tap into the lucrative market of 800 million iTunes users, the majority of whom use their iPhone or other Apple products exclusively.

As seen below, Apple users statistically have more available income at their disposal and spend more money on apps, music, games or whatever else is available on their mobile devices. And this is what Google is really after; Google wants to get a piece of the crème de la crème pie, by enticing the big spenders to move into their Android ecosystem and spend dollars at Google Play rather than iTunes. This is where the big bucks come in and that is what is getting investors excited.

iphone vs android users

Charting the Targets

As illustrated above, what Google investors really care about is how this new Nexus X will rival iPhone to lure more Apple iTunes users to Google Play.  At the moment,  it seems that investors are indeed optimistic. The targets range from the strongly bullish, who target $750 a share, a 27% upside, to the more conservative bulls who eye $672, a 14% upside. But what is more interesting is that the bears foresee a downside risk of 3% which is, all in all, a rather moderate prediction and a signal that investors expect little downside risk.

goog_sept

 

Will the Nexus X deliver? Will Google get its hands on those lucrative iTunes users? Only time will tell, but when it does, analysts, it seems, may have already carved out the upside targets.

 

And now it’s up to you! Is it a good time to invest in Google? You decide.

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