Apple becomes first firm to top $800 bn mcap
Apple Inc became the first US company to top the $800-billion mark in market capitalisation on Tuesday, slightly more than two years after it crossed the $700-billion threshold. The iPhone maker’s shares have gained 33% this year and almost 50% since the US election in November. The company represents about 4% of the $21.7 trillion that makes up the entire S&P 500 index.
Apple accounted for as much as 4.9% of the S&P 500 in September 2012 but is a smaller percentage now as the index as a whole has rallied more than 7% this year.
“It may be the most powerful franchise in the country today,” said Rick Meckler, president of LibertyView Capital Management in Jersey City, New Jersey, whose firm does not own the stock. “Considering that it has a limited number of products, it has really dominated that market in a way that few companies have, and it’s been able to retain margins despite lots of competitors.”
If Apple continues on its growth path, the company will top the $1 trillion market cap level later this year.
Stock buybacks have also bolstered Apple shares, with the company reducing its actual share count by 20.9% and the average diluted shares outstanding by 20.5% over the past four years, according to Standard & Poor’s data.
The median price target on Apple is $160, up from the $140 median three months ago. Shares closed at $153.99 on Tuesday.
The closing market cap of $802.8 billion was larger than the economies of 45 of the 50 US states, topped only by Illinois, Florida, New York, Texas and California.