We again applaud you and the rest of management for Apple's impressive operational performance and growth. It is truly impressive that, despite severe foreign exchange headwinds and massive growth in investment (in both R&D and SG&A), the company will still grow earnings by 40% this year, according to our forecast. After reflecting upon Apple's tremendous success, we now believe Apple shares are worth $240 today.
Apple is poised to enter and in our view dominate two new categories with a combined addressable market of $2.2 trillion, a view investors don't appear to factor into their valuation at all. We believe this may lead to a de facto short squeeze, as underweight actively managed mutual funds and hedge funds correct their misguided positions. To arrive at the value of $240 per share, we forecast FY2016 EPS of $12.00 , apply a P/E multiple of 18x, and then add $24.44 of net cash per share. Just as Apple's market capitalization hits the $3 trillion milestone, its share price as a percentage of the Nasdaq 100 index's (.NDX) value is bumping up against a key technical level. In recent prior times, the stock price has risen above such a level and then subsequently declined.
Apple has clearly demonstrated a track record of excellence and success when entering new categories. We expect this to continue with the Apple Watch, the television, and the car, and the world will look back on today's undervaluation as a fascinating example of market inefficiency . Because of this, we encourage both accelerated and larger-magnitude share repurchases as you consider how to allocate capital going forward. As you continue to evaluate this opportunity, and consider the right prices at which to opportunistically repurchase shares, we hope you give credence to our advice in light of our investment record.
Unlike the many actively managed mutual funds and hedge funds that are underweight Apple and have underperformed the S&P 500, we have exhibited strong outperformance, thanks in part to our large position in Apple. Generally, investors have been happy with the progress they've seen. The stock market opened for the first time in 2022 today, January 3, and Apple's share price surpassed $182. There are about 16.4 billion outstanding Apple shares, giving Apple a total market capitalization of over $3,000,000,000,000. With Apple's shares trading for just $128.77 per share versus our valuation of $240 per share, now is the time for a much larger buyback. We appreciate that the Board just increased the share repurchase authorization by $50 billion, and that it continues to prioritize share repurchases over dividends .
We again simply ask you to help us convince the board of how these two underlying issues persist and combine to enhance the opportunity for accelerated share repurchases in greater magnitude. We also ask you to help us convince the board that this is not a choice between investing in growth and share repurchases. But by the end of 2002, the stock price declined to $14.33 a share, which represented an approximately 40% loss in the hypothetical $100 stock purchase made at the start of the year. However, the next couple of years were refreshingly lucrative for Apple investors as the company continued to advance in the marketplace with more advanced versions of its popular iPod, and the opening of the iTunes store in 2003. By the end of 2004, Apple's stock price climbed to $64.40 per share, making an original four share investment worth $257.60.
The tech and services company has positioned itself to take some advantage of its new stature. In early August, the company announced a four-for-one stock split, the company's fifth stock split since going public in 1980. Individual shares are trading in the mid-$400's, so for instance a unit worth $440 would be split into four shares of $110. That makes them more affordable for smaller investors to pick up. Excluding advertising, the addressable market for television is approximately $575 billion, which is larger than the smartphone market. Also, given that people spend an average of 12% of the day watching TV (equating to 25% of their free time), we view television's role in the living room as a strategically compelling bolt-on to the Apple ecosystem.
In addition to an Ultra High Definition television set, we expect Apple to launch a related suite of tiered products and services, including a "skinny bundle" of pay-tv channels and an updated Apple TV microconsole . This will enable Apple to pursue the entire market by offering multiple products at various price points across the demographic spectrum. A pandemic-era surge in tech stocks has driven the major US tech companies to new highs, pulling US stock markets with them. Market cap does have its drawbacks as an evaluation method, however.
For starters, market cap changes frequently, and it's closely tied to the company's current share price. It doesn't take into account any of the direct financial metrics of the company, such as earnings per share, growth rate or book value. On the first day of trading in 2022, the Silicon Valley company's shares hit a record high of $182.88, putting Apple's market value just above $3 trillion.
The stock ended the session up 2.5% at $182.01, with Apple's market capitalization at $2.99 trillion. Apple Inc. is a global technology company that designs, manufactures, and sells smartphones, personal computers, tablets, wearables, and accessories. Apple stock has been trading with record highs over the past few weeks, and today the company has reached a new milestone in valuation. The value of a single AAPL share hit around $182.90 during intraday trading, making Apple the first company in the world to be worth $3 trillion. For comparison, some of the most valuable US gaming companies by stock price include Activision Blizzard ($52.27 billion), EA ($38.1 billion), and GameStop ($11.76 billion).
Microsoft, which has many businesses, has a total valuation of $2.5 trillion, while Alphabet is worth $1.927 trillion. The stock market is always changing, and it is only one measure of a company's financial success. Shortly after surpassing $3 trillion today, Apple's share price dropped, pushing the company's market cap down to $2.99 trillion. Furthermore, ongoing innovations and enhancements to all of the above will drive even more premium market share gains for iPhone, which sits at the epicenter of this mega-ecosystem. Collectively, these failures have caused Apple's earnings multiple to stay irrationally discounted, in our view.
Collectively, these failures have caused Apple's earnings multiple to stay irrationally discounted, in our view. The Cupertino, California-based company's shares briefly rose to as high as $468.65 on Wednesday, equivalent to a market capitalization of $2.004 trillion. The stock was last up 1.2% at $467.62, giving Apple a market capitalization of $1.999 trillion. Stock buybacks reduce the number of total shares available for purchase. That makes each remaining share more valuable and improves the underlying fundamentals of the company in equations that large investors and automated trading systems use to pick stocks.
When Apple unveiled the iPhone in January 2007, the company was worth $73.4 billion. Fifteen years later, the iPhone, already one of history's best-selling products, continues to post impressive growth. In the year ending in September, iPhone sales were $192 billion, up almost 40 percent from the year prior.
Apple on Monday became the first company to hit a market capitalization of $3 trillion — more than nine times what the company was worth when founder Steve Jobs died in 2011. Under Tim Cook, who in 2011 became chief executive following Jobs' death, Apple has sharply increased its revenue from services like video streaming and music. That helped Apple reduce its reliance on the iPhone to about 52% of total revenue in fiscal 2021 from over 60% in 2018, pleasing investors worried the company relied too much on its top-selling product. On the first day of trading in 2022, the Silicon Valley company's shares hit an intraday record high of $182.88, putting Apple's market value just above $3 trillion.
The stock ended the session up 2.5% at $182.01, with Apple's market capitalization at $2.99 trillion. While it certainly would have been wonderful to acquire Apple stock for just a little over $20 a share in hindsight, that doesn't mean the stock isn't now also worth buying at a just under $200 a share. Apple's financials look strong across the board, and the company has more than established its ability to introduce quality products and win in the marketplace. Therefore, investors may do well to consider buying Apple for future returns on investment. The incredible run of Apple stock has been well-documented along with most of the company's history and ground-breaking products.
As daunting as it may seem now, imagine what a small investment in a company like Apple several years ago would be worth today. A mere $100 investment in the company's stock at the beginning of 2002 would have grown to more than 130 times the original investment by mid-October 2019. The market capitalization sometimes referred as Marketcap, is the value of a publicly listed company. In most cases it can be easily calculated by multiplying the share price with the amount of outstanding shares.
As of February 2022 Apple has a market cap of $2.730 Trillion. This makes Apple the world's most valuable company by market cap according to our data. The market capitalization, commonly called market cap, is the total market value of a publicly traded company's outstanding shares and is commonly used to mesure how much a company is worth. Apple last month became the first company to reach a market capitalization of $3 trillion.
But with a pullback in Apple stock after hitting that milestone, many investors are wondering if AAPL stock is a buy right now. From a 52-week low of $116.21, Apple's share price reached a high of $182.94 on Jan. 4. The company's market capitalization also fluctuated during this period. When the markets closed on Jan. 28, Apple's share price was $170.33, giving the company a current market capitalization of about $2.78 trillion.
Apple first sold shares to the public on Dec. 12, 1980, at $22 per share. The stock has split four times -- three times at 2-for-1, and one split at 7-for-1. This means you would have received two shares for every one share, or seven shares in that one case.
The waystock splitswork is that you receive more shares but the stock price is cut proportionally, so the value of your investment stays the same. After tax, they would be left with about $1.6 million for reinvestment, Egan estimates. If that sum is invested in stocks, ETFs or balanced funds that have a combined return of five per cent before inflation, it would produce $80,000 before tax and $69,600 after 13 per cent average tax assuming this income is split. Diversified investments in exchange-traded funds could contain Apple shares, Egan notes.
Selling only part of the $1.6 million of mostly Apple shares could balance faith in the company with diversification. The Silicon Valley company has tripled its valuation in just under four years. Apple first paid a dividend in 1987, but financial trouble caused the company to suspend dividend payouts in 1995. After selling millions of iPods, iPhones, and iPads, and raking in billions in profits, Apple reinstated the dividend in 2012. The company currently distributes a quarterly payout of $0.77 per share.
With 254 shares, you would be earning $782 every year in dividend income -- a nice return on an original investment of just $100. The tech giant's biggest moneymaker has been its iPhones while investors are betting on the company's push into new markets such as automated cars and virtual reality. But financial experts say that individual investors should beware of getting burned on the Apple hype. Some of the expected uptick in stock interest around the valuation and stock split are already built into the stock price. A growing reliance on ever-expanding services and continuing global success with iPhone, iPad, and the Mac certainly do not hurt. Apple is edging closer to becoming the first publicly held U.S. company worth $3 trillion.
In early trading on Monday, the technology titan's shares nosed up 1%, valuing the company at $2.96 trillion. Effective Tax Rate – importantly for the company's income tax rate, we consider 20% a more appropriate tax rate for the purposes of forecasting real earnings, not the 26% effective tax rate Apple uses in their income statement. Most companies in the S&P 500 state that they plan to permanently reinvest their international earnings and therefore do not have to accrue for an income tax on unremitted earnings and thus show a lower tax rate. Google is a good example of this, as its effective tax rate is 20%. Apple, unlike Google and most companies in the S&P 500 has chosen to accrue income taxes on some of its unremitted international earnings and according has an effective tax rate of 26%. Therefore, when assessing the multiple of earnings at which Apple should trade, we believe it is appropriate to use a 20% tax rate for Apple in order to make such comparisons Apples to Apples, no pun intended.
And for Apple, the car market is more than big enough to "move the needle" significantly, even as the world's largest company. As we mentioned previously, today Apple is approaching a $2 TRILLION market cap. The company did a 7-1 stock split in 2014, transforming Steve's 5.5 million shares into 38.5 million shares. The company did a 4-1 split in August 2020, transforming those 38.5 million shares into 154 million shares.
Apple's stock on Tuesday morning was hovering just below the threshold required to reach a market capitalization of $3 trillion, a milestone no publicly traded U.S. company has ever reached. US technology giant Apple has become the first company to hit a stock market valuation of $3tn (£2.2tn). Mr. Lazonick said that buybacks increase stock prices by encouraging investors to buy, and then causing momentum in the stock market as other investors look to cash in on the increase. He added that the company "seems to be in good position to work through supply-chain issues" which have been affecting tech companies large and small. The London Stock Exchange , which has lagged behind its European and US rivals by climbing 14.3% last year, was closed on Monday for the new year bank holiday. The FTSE 100 has been criticised as "old-fashioned" due to its dearth of tech companies and a glut of oil and bank stocks.
It remained 6.5% below its May 2018 peak last year while the US, German and French markets all hit record highs. The news came as US markets edged higher and European shares bounded to record highs in the first day of trading in 2022 as investors bet on a steady economic recovery despite the rising number of Covid-19 cases caused by the Omicron variant. By way of comparison, the price-earnings ratio, which is another popular valuation method, is also closely tied to a company's market share price. The P/E ratio also relies heavily on a company's earnings, which some investors feel is a more important determinant of a company's valuation.
If you had bought just one share of Apple, you would own 56 shares today after the stock splits. Those shares would be worth $14,896 at the current price of $266 per share. In February 2020, it was revealed that he had sold some $800 million worth of Apple shares. He does not appear to have bought any since, so the increase in value of his holdings is entirely down to the share price rise. The number of shares he owns will also have increased, but that is because of Apple's new stock split. The tech company isn't the first to hit the $2 trillion mark.
Saudi Arabia's state-owned Saudi Aramco, the world's largest producer of oil, did so during its December 2019 stock debut. But the company was hammered during this year's global economic slowdown and a plunge in oil prices, and its valuation has since tumbled to $121 billion. Apple is also no stranger to financial milestones among publicly traded companies.
In August 2018, the company became the first to reach a $1 trillion valuation. Its value doubled two years later in August 2020 when AAPL reached hit a $2 million market cap. That also means Apple's valuation added another trillion dollars faster in roughly 16 months than it did between the first and second trillion. Today, Apple became the first US company to achieve a $1.5 trillion market capitalization. The stock surged even as investors began pulling back in many other areas of the economy.
How Much Is 50 Shares Of Apple Worth On Monday, the company crossed the $3 trillion mark when its share price hit $182.88 in midday trading before paring some of its gains. Q.ai is the trade name of Quantalytics Holdings, LLC. Q.ai, LLC is a wholly owned subsidiary of Quantalytics Holdings, LLC ("Quantalytics"). Quantalytics is not a registered investment adviser, brokerage firm, or investment company.
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