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How to Profit From the Smartphone Wars

With Apple's iPhone next weekthe most widely anticipated in a wave of new product launches, investors need to be choosy as only a few companies will emerge as winners at the end of the smartphone battles.

Samsung phone and an iPhone 4
Damien Meyer | AFP | Getty Images
Samsung phone and an iPhone 4

“For companies to put out their hottest new product when everyone’s heads will be turned by Samsung and Apple, it’s almost a waste,” said Brian White, analyst at Topeka Trading.

While Apple remains most people's favorite stock, strategists say other mobile-related companies could see gains from the smartphone wars.

As an alternative to Apple, White advised investing in Qualcomm , which is a supplier for both Apple and Samsung’s smartphones. Broadcom and Cirrus Logic are other major Apple suppliers.

Meanwhile, Patrick Moorhead, President & Principal Analyst of Moor Insights said Microsoft is a good play on operating systems.

“You have Nokia and Samsung [using Windows 8] and there will be more companies going forward,” said Moorhead.

Moorhead said he expects Microsoft's Windows-based platform to see "at least single-digit gains" in market share over the next six months. As a result, the company has “no place to go but up.”

It's not just Apple's iPhone that rivals are looking to steal market share from. Adding to the tech-release frenzy, Amazon.com launched its new e-reader and a larger version of its Kindle FireThursday in an effort to take on Apple's iPad and the rumored iPad mini, which is expected to be launched by year-end.

While Amazon's shares rallied to all-time highs, analysts were largely unmoved.

"Nothing really grabbed our attention and [Amazon's] announcement will do little to halt the momentum of Apple's iPad franchise that continues to gain momentum around the world," according to White in his latest research note.

For investors still looking to invest in Apple, White says the stock has further upside room, despite hitting an all-time high on Friday. He expects the company's brand to continue strengthening over its competitors and has a unique $1,111 price target and “buy” rating on the iPhone maker.

“In fact, we wouldn’t be surprised if HTC, Nokia and RIM are no longer standalone companies 18 to 24 months from now,” he said. Shares of Nokia and Research In Motion have both lost nearly 50 percent of their value year to date.

Earlier this week, Nokia and Motorola Mobility (now owned by Google ) both unveiled new handsets, which were met with tepid responses from critics. Nokia's shares plunged more than 15 percent following the announcement.

And more product releases are on the horizon this month: Motorola is expected to unveil an Intel -powered phone on September 18 in London and HTC is scheduled to take the wraps off a new smartphone on September 19.

By CNBC’s JeeYeon Park (Follow JeeYeon on Twitter: @JeeYeonParkCNBC)

Questions? Comments? Email us at marketinsider@cnbc.com

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  • Patti Domm

    Patti Domm is CNBC Executive Editor, News, responsible for news coverage of the markets and economy.

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