If you're looking to get a better understanding of the technology industry for investing purposes, watching stocks of popular hardware companies could be a good place to start. Most people have considerable firsthand experience with tech hardware, and this familiarity can provide a good jumping-off point for potential investments. Leading hardware companies also have considerable impact on the progression of technology and the market at large.

Investing in what you know isn't a surefire way to generate strong returns, and it's not without its dangers, but it is a strategy that has been successful for new and seasoned investors. Regardless of where you might fit in on that continuum, here's why Apple (NASDAQ:AAPL) and GoPro (NASDAQ:GPRO) are stocks to watch in hardware.

Apple
With a market cap of roughly $700 billion and a dominant position in the high-end mobile market, Apple stands as one of the largest and most influential players in hardware. A report from Canaccord Genuity estimated that the company captured 92% of the operating income among the top eight smartphone manufacturers in the first quarter, despite the fact that iOS devices have a minority of global market share. IDC estimates that 18% of mobile devices worldwide ran on the company's operating system in the first quarter of 2015, with an estimated 78% of devices using the Android platform.

In America, where the market is more receptive to Apple's premium pricing model, ComScore estimates that Apple currently has above 40% market share. The company's success in cultivating a valued lifestyle brand in the tech sector has helped it deliver annual diluted earnings per share growth of 198% over the last five years, and share price growth of roughly 230%.

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iPhone 5c. Source: Apple.

While the company looks strong on the whole, it has recently seen a small stock contraction tied to lower-than-expected sales of tablets and Apple Watches. Shares have dipped about 6% over the last three months, bringing the company's forward price-to-earnings ratio to approximately 13 -- a ratio that suggests the stock may be undervalued when viewed in comparison to the S&P 500's forward P/E value of roughly 18.

Apple also pays a dividend, with its payout currently representing a roughly 1.7% yield. Its current payout ratio of 22.8% and history of earnings growth suggesting that it has lots of room to raise its payout. With a strong position in mobile and upcoming projects like the rumored Apple car, the company is sure to play a defining role in the future of tech and is one of the most influential stocks to watch in hardware.

GoPro
GoPro's roughly year-long history as a publicly traded company has been characterized by volatility and heavy short interest, but the camera maker has been delivering strong earnings reports and has yet to show weakness in the face of emerging competition. Like Apple, GoPro has built a brand that carries significant cachet among its expanding consumer base. Its products are virtually synonymous with action cameras, enabling the company to succeed with a premium pricing model and generate strong margins. GoPro doesn't manufacture the components in its cameras, with chipmaker Ambarella providing the key image and video processing chips that power its devices, so the strength of its branding and media efforts are essential to its success.

GoPro stock reached a lifetime high of $98.47 in October 2014, but anticipation that competition from the likes of Xiaomi, Apple, and Samsung could destabilize the emerging company pushed its share price below $40 in March of this year, though it's now back around $60.

GoPro has a forward P/E ratio of roughly 45, a valuation that assumes the company will be able to continue delivering impressive growth. Continued success in international markets and strong new product lines will be key to GoPro's ability to live up to and exceed its present valuation, and it looks like the company may be able to deliver on those fronts.

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GoPro HERO 4 Session. Source: GoPro.

GoPro has introduced five new cameras to the market within the last 10 months, with the most recent being the compact HERO 4 Session and the screen-featuring HERO+LCD, and it has flying drone cameras and virtual reality cameras on the horizon. New products and big international growth helped the company deliver a roughly 68% year-over-year sales increase in its second quarter, with international sales accounting for more than 50% of revenue. Combined revenues from GoPro's EMEA and APAC segments in the company's last quarter increased an impressive 126% year over year.

With a strong brand, major momentum in the action camera space, and a history of big share price volatility, GoPro stands as one of the most exciting stocks to watch in hardware.

Keith Noonan has no position in any stocks mentioned. The Motley Fool recommends and owns shares of Ambarella, Apple, and GoPro. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.