We told you this technology would grow faster than the smartphone…

And now, the man who runs the biggest smartphone company in the world is on board.

Apple CEO Tim Cook says virtual reality technology could be as big as the company’s signature iPhone:

The smartphone is for everyone. We don’t have to think the iPhone is about a certain demographic, or country, or vertical market: It’s for everyone. I think AR [augmented reality] is that big. It’s huge.

[Augmented reality mixes virtual and real worlds. Sometimes, it’s called “mixed” reality. The popular AR game Pokémon Go is an example.]

Apple has been aggressively moving in on this space. Palm Beach Letter editor Teeka Tiwari wrote about it in the February issue. (PBL subscribers can access it right here.)

Here’s what Teeka had to say:

Apple is the company that developed the smartphone sector and has the most to lose from mixed reality. That’s why it has been on a mixed reality hiring binge. … A mixed reality headset is in Apple’s cards for sure. If it’s anything like the company’s past products, it will be a game changer.

Apple has 600 engineers working on a mixed reality headset. So it’s all in on this new technology.

And the company’s embrace of virtual reality technology is showing up in its stock price…

Virtual Reality Is Boosting Growth

Recently, Goldman Sachs increased Apple’s 12-month stock price target from $133 to $150.

That increase was based on “major new features” in the next iPhone, due out in September.

What are those new features?

Software enhancements such as 3D-sensing technology… That tech is crucial to augmented reality.

Goldman Sachs believes augmented reality features will be a “significant step up in innovation” compared to the iPhone’s prior two product cycles.

Shares of Apple have climbed nearly 22% in the past three months. That’s compared to a 7.5% increase for the Dow Jones Industrial Average.

This is more proof that Teeka’s MAP-cycle thesis is playing out in the virtual reality space.

The MAP Cycle Is Kicking Into Overdrive

Over the past two weeks, we’ve been telling Daily readers about a little-known ratio called the mass adoption point (MAP).

The MAP ratio looks at the price of a technology compared to its adoption. Each time the unit price goes down, more people buy it.

Over the years, the MAP ratio has shown up again and again.

Each time it’s kicked in, share prices soared.

And we’re starting to see it with Apple again… this time in the VR space.

Virtual reality is expected to be a $90 billion trend.

And we’ve found a safe way to play this trend in The Palm Beach Letter (subscribers can access the issue right here).

There’s another trend our MAP has targeted that could be much bigger than virtual reality. In fact, it could be a potential $11 trillion bonanza.

The technology is called the blockchain. And every $200 placement in our favorite play in this space could turn into more than $6,000.


Nick Rokke, CFA
Analyst, The Palm Beach Daily

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