Apple’s market capitalization crossed the elusive $3 trillion threshold again on Tuesday as its shares rose to a four-month high amid forecasts of a booming holiday quarter for the Silicon Valley giant.
Shares of Apple rose 2% to about $193 by late afternoon, pushing its value to $3.01 trillion.
Apple, by far the world’s most valuable company, has seen its share price rise 54% this year, driven by rising profits and a broader rally in technology stocks.
Apple reported its most profitable third quarter ever last month, and analysts expect the company to break records in the current fourth quarter, which crucially includes the holiday season.
According to FactSet data, analysts forecast that Apple will post revenue of $118 billion and net income of $32.4 billion in the fiscal year ending next month, the highest respective sales and profit figures since 2021 corresponds.
Investor confidence in Apple was boosted Tuesday by data that suggested strong growth in its highly profitable services division. UBS analyst David Vogt said in a note Monday that App Store spending rose 11% annually last month, according to data from Sensor Tower, upping his forecast for overall growth of 16% in Apple’s services division this quarter reinforce.
About $940 billion. That’s how much market value Apple added this year. That’s more than the market capitalization of Facebook parent company Meta, the seventh-largest company in the world, at around $815 billion.
Analysts largely believe Apple’s already high valuation leaves little room for growth, and Apple’s average stock price target of $197 implies only a 2% upside. In a note last month, Bernstein analyst Toni Sacconaghi wrote that he finds it difficult to “pay more for Apple than other large-cap technology stocks with higher expected growth and better margin profiles.” Apple currently trades at about 29 times forward earnings, well above the S&P 500’s median price-to-earnings ratio of 17.
Apple is one of seven companies worldwide with a market capitalization above $1 trillion and leads the club whose other members include Microsoft, Saudi Aramco, Alphabet, Amazon and Nvidia. Microsoft, whose shares have risen 55% this year to an all-time high, is the second most valuable company at about $2.8 trillion. Apple hit its own all-time high stock price in July this year, recouping its 27% loss in 2022. With net income of $97 billion in its most recent fiscal year, Apple was by far the most profitable company in the S&P, dwarfing silver medalist Microsoft’s $72 billion profit.
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