Here's what Apple's new iPhone is missing

Diehard Apple (AAPL) fans fretted for months over what would go missing in the newest iPhone. But investors are more worried about something other than an absent headphone jack: the missing enthusiasm for Apple's stock.

Shares of Apple fell 0.7% in the 30 days leading up to the 11th iPhone product launch Wednesday, lagging the Standard & Poor's 500 index 0.1% increase during the same time. The lackluster stock reaction coming into the smartphone announcement is a departure from previous Apple smartphone launches going back to the original iPhone almost a decade ago.

If there's a bright spot for investors, it's that Apple's shares performed better Wednesday than on announcement days in the past. Shares closed up 66 cents, or 0.7%, to $108.36. That first-day reaction breaks a string of declines or no changes in the stock following the announcements of the previous four phones.

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But expectations going in were low. On average, prior to the iPhone 7, Apple shares have gained 3.8% in the month prior to a product announcement.  The last iPhone, the shrunken-down and discounted SE, gained 10.3% in the 30 days prior to the March 2016 announcement as the S&P 500 rose 6.9%.

The lack of excitement is notable given the importance of the product to Apple; iPhone revenue accounted for two-thirds of Apple's revenue last year, according to market research firm Trefis.

The lackluster run is even more disappointing since the stock typically runs into pressure afterward. Apple's stock has declined an average of 0.6% in the 30 days after the previous iPhone announcements going back to 2007. In the last four cycles, shares of Apple fell 4% in the two weeks after new phones were actually launched and made available, UBS analyst Steven Milunovich says. 

The smartphone is a mature product, and the company's other offerings ranging from watches to tablet computers as well as music and payment services have failed to pick up the slack. Apple unveiled a new iteration of its watch Wednesday but didn't address one of the top concerns: battery life. Apple's revenue is expected to fall 8% this fiscal year ended in September to $215.4 billion, says S&P Global Market Intelligence. Even with a new smartphone launch next fiscal year, analysts see revenue inching up just 4%, a fraction of its 28% revenue growth in fiscal 2015 and 31% average revenue growth over the past five fiscal years.

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Samsung continues to challenge Apple. Apple claimed 75% of the premium-tier smartphone profits in the second quarter, says Michael Walkley, analyst at Canaccord Genuity. But that's down from Apple's 90% share in the first quarter due to Samsung capitalizing on better demand for its Galaxy S7 device, he says.

Still, people waiting to upgrade their phones may finally pay up for the iPhone 7 or new phones launched in 2018, Walkley says. Apple still also has a large captive audience of users to pitch its services. Analysts think Apple shares should be worth $123.25 each in 18 months. "Barring any surprises, such as an iPhone price cut, we see limited downside risk," Milunovich says.