Apple comes out with leasing offer for latest iPhone

Apple has habit of surprising its customers through its new launches. In its September 9 event, Apple has launched many new products including a 12.9-inch iPad Pro, a sophisticated stylus, a revised Apple TV, and the refreshed iPhone. The company has also announced that the latest iPhone can also be purchased through monthly payments starting at $32 and customers getting free upgrades after every year.

Peter Karazeris, a senior equity analyst for Thrivent Asset Management, who owns $400 million worth of Apple's shares, said that the announcement will definitely move Apple's stock and especially when iPhone's sales account for 56% of Apple's revenue.

As per experts, the announcement of installment option has moved the company's shares as it finished at 4.5% amounting $114.21. But then also, the stock is still down 14%. Many experts were of the view that if the leasing program works then Apple could soar 50% in the coming year.

Currently, Apple trades for 11.8 times earnings projections for the next 12 months. Mark Mulholland, portfolio manager for the Matthew 25 fund, was of the view that Apple's shares have been quite cheap for the six years. But he thinks that the leasing program could prove a game changer for the company and increases the iPhone growth.

Apple's leasing program offer puts in competition with the wireless carriers that all offer installment plans.