Apple becomes most valuable company of all time
Apple is the world's most valuable company, ever.
On Monday, its surging stock propelled the company's
value to $623 billion, beating the record for market capitalization set by
Microsoft Corp. in the heady days of the Internet boom.
After a four-month dip, Apple's stock has hit new highs
recently because of optimism around what is believed to be the impending launch
of the iPhone 5, and possibly a smaller, cheaper iPad.
Apple Inc. has been the world's most valuable company
since the end of last year. It's now worth 53 percent more than No. 2 Exxon
Mobil Corp.
Apple's stock hit $664.74 in midday trading before
retreating slightly to $661.70. That was $13.42, or 2.1 percent, higher than
Friday's close.
Microsoft's 1999 peak was $620.58 billion, according to
Standard & Poor's.
The comparison to Microsoft does not take inflation into
account. In inflation-adjusted dollars, the software giant was worth about $850
billion on Dec. 30, 1999. Microsoft is now worth $257 billion.
Analysts believe Apple's stock has room to grow. The
average price target of 38 analysts polled by FactSet is $745.80.
Despite the surge, Apple's stock is not particularly
expensive compared to its earnings for the last twelve months. The company's
"price-to-earnings ratio" is 15.6, compared to 16.1 for the S&P
500 overall. That suggests investors, unlike analysts, don't believe the
company can grow its sales much from current levels.
Apart from the iPhone and "mini iPad," analysts
are speculating that Apple plans to make a TV set to complete its suite of
consumer electronics products. Apple usually doesn't comment on its future
product plans until a few weeks or days before a launch.
Apple's stock surge has made it a major part of many
investment portfolios, often without the investors realizing it. The company
makes up 4.7 percent of the value of the S&P 500 index, which is used as
the basis for many mutual funds.
Figures supplied by FactSet imply Microsoft's market
capitalization record was $619.25 billion, somewhat lower than the $620.58
billion calculated by S&P. The difference lies in the number of outstanding
shares the firms ascribe to Microsoft at the time.
China's largest oil company, PetroChina, could lay claim
to having hit a market capitalization even higher than Apple's, because of the
particularities of the Chinese stock market.
PetroChina was briefly worth $1 trillion after it listed
on the Shanghai stock exchange in 2007, but only based on its price on that
exchange, which is isolated from the rest of the financial world because of
Chinese laws on foreign investment. PetroChina's shares also trade in Hong Kong
and on the New York Stock Exchange, and based on prices there, its market
capitalization never went as high as $500 billion.
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