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Companies' stock CAGR returns since releasing revolutionary products.

Updated: Oct 15, 2023

Disclaimer: This communication is provided for information purposes only and is not intended as a recommendation or a solicitation to buy, sell or hold any investment product. Readers are solely responsible for their own investment decisions.

 


Definition of Revolutionary products

  • A revolutionary product is typically characterised by its ability to introduce significant and groundbreaking changes or innovations to an industry, market, or people's lives. (source: Google Bard)


Variable to note

  • CAGR cutoff date is March 2023

    • source: Google Bard


Observations

CAGR of companies till cutoff date since releasing revolutionary products.

  • Apple

    • 27% since release of iPod in 2001

    • 32% since release of iPhone in 2007

    • 30% since release of Macbook Air in 2008

  • Amazon

    • 37% since release of AWS in 2006

  • Microsoft

    • 20% since release of Azure in 2010

  • Tesla

    • 50% since release of Model 3 in 2017


Honorable mentions

  • Netflix

    • 25% since introducing streaming business model in 2007

  • Adobe

    • 24% since introducing subscription model for their products in 2013

  • Airbnb

    • Introduced a revolutionary sharing economy model,

      • but is excluded from this list since the company is only listed less than 5 years.

  • Uber

    • Also introduced revolutionary sharing economy business model, but its not a sustainable/ scalable business model from a cashflow perspective.



Conclusion

  • When a company's underlying fundamentals are good,

    • Investing in them when they introduce revolutionary products to the market may be a good strategy.

    • Especially when they have track records of producing revolutionary products.

    • Plus if they can come up with innovative business models to capitalise on it, it will be even better.

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