Apple Is First Public Company Worth $1 Trillion

Alicia Cross
August 4, 2018

"The reason you get to a trillion dollars is that you create in your business model built-in barriers for customers to move elsewhere".

Like the four-minute mile or breaking the sound barrier, the idea of a company with a market capitalization - the share price multiplied by the number of outstanding shares - of more than a trillion dollars was once nearly unthinkable. It became the first $900 billion company exactly nine months ago, on November 3, 2017.

The iPhone maker's market value reached the figure in late morning trading in NY as its shares rose to a new record high above $207.

The share price jumped by more than 8 percent this week after Apple reported impressive quarterly earnings on Tuesday, driven largely by strong sales for high-price iPhones.

Apple's stock market value is greater than the combined capitalization of Exxon Mobil Corp XOM.N , Procter & Gamble Co PG.N and AT&T Inc T.N .

With over 1 billion Apple devices in daily use, the traction this ecosystem provides ensures that the company will have dependable returns regardless of market conditions.

Looking at Apple's current financial health, Michael is spot on.

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Indeed, as we pointed out yesterday, the company managed to grow its revenue by a whopping 17 percent year-over-year to a total of $53.3 billion in the third quarter of 2018. The shares are up 22 per cent so far this year.

The highest price expectation for the stock is Brian White's $275 target, which would mean a $1.3 trillion valuation, according to the analyst from Monness Crespi Hardt, who says he was first on the Street with a price target that reflected a $1-trillion valuation.

True, Apple's earnings growth rate is slowing down.

Adjusting for four stock splits over the years, Apple debuted on the stock market for the equivalent of 39 cents a share on December 12, 1980, compared with Thursday's high of $208.38.

The first company to hit $1 million in market capitalization.

Behind Apple are Amazon, Google parent Alphabet, Microsoft and Facebook. All of that makes a 5%-to-10% premium valuation for Apple look plenty reasonable, and its shares worth holding for longer. In August 2011, 18 months after iPad was launched, the firm was worth a whopping $624 billion.

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