Apple (AAPL) shares hit a fresh record high, breaching the $3 market value level for only the second time ever Wednesday, as the world's biggest tech company continues to pace gains for the Nasdaq's best first half start in four decades.
Apple shares were last marked 0.5% higher on the session at $189.02 each, after hitting an all-time high of $189.90 each earlier in the session.
The move has extended the stock's year-to-date advance to around 45.6% (based on a December 30 closing price) and now values the Cupertino, California-based tech giant at just under $3 trillion.
Better-than-expected iPhone sales of $51.33 billion powered overall group revenue for Apple over the fiscal second quarter, which ended in March, but its top line still slipped 2.5% to $94.84 billion. That marked the second consecutive sequential decline, a rate Chief Financial Officer Luca Maestri said would likely carry over into the June quarter.
Revenue from Apple's key services business -- which includes Apple Pay, iCloud and Apple TV --- rose 5.5% to $20.91 billion, and Wedbush analyst Dan Ives believes that portion of Apple's business could catapult the group to a $4 trillion valuation by 2025.
"Apple playing chess while others play checkers", Ives said. In (the current financial year), the Cupertino stalwart is on pace to approach $100 billion of annual services revenue growing double digits which is a jaw dropping trajectory vs. the roughly $50 billion+ of services revenue that Apple was delivering only in FY20."
"Herein lies the key to the valuation re-rating that we believe will continue to take place around Apple's stock as the Street further appreciates the sheer massive potential of this services revenue that we now assign a valuation in the $1.4 trillion range,' he added. "We believe Apple's fair valuation could be in the $3.5 trillion range with a bull case $4 trillion valuation by FY25."
Apple shares were last valued at just over $3 trillion in early January of 2022, when the stock traded at $182.86, but there were more Apple shares outstanding to boost its overall value.
Apple issued a negative net total of $89.402 billion in shares last year, a figure that incorporates its regular buybacks, and a net negative total issuance of $39.07 billion over the first three months of 2023.
Apple reached the $2 trillion threshold in August of 2020, thanks in part to a surge in iPhones and Mac sales linked to the global pandemic, nearly two years to the day after it became the first U.S. company to breach the $1 trillion mark.
Apple's 2023 gains have also formed the key plank in the Nasdaq's current year-to-date gain of around 30%, the best first half start to any year since 1983.
The influence of so-called Big Tech stocks, which Bank of America has dubbed 'The Magnificent Seven," has been undeniable.
Apple, Microsoft (MSFT), Google (GOOGL), Meta (META), Amazon (AMZN), Tesla (TSLA) and Nvidia (NVDA) comprising around 9% percentage points of the S&P 500's year-to-date gain of around 14%.
These seven stocks also make up nearly a third (around 31%) of assets under management in its Global Wealth and Investment Management division, a 44% increase since the start of the year.
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