Apple stock closes above $3 trillion valuation for the first time ever
- Apple stock closed above a $3 trillion valuation for the first time ever on Friday.
- The stock has fully recovered from 2022's bear market and has been making new record highs.
- Investors have cheered Apple's strong product ecosystem and resilient growth powered by its iPhone and Services business.
Apple stock on Friday closed above a $3 trillion valuation for the first time ever.
The threshold was hit after Apple stock topped $190.73, and based on its current shares outstanding of 15.79 billion, that gives the company a valuation that is bigger than France's annual GDP.
Shares rose 2% to $193.77 in Friday's trading session, making it worth $3.06 trillion.
Apple briefly hit a $3 trillion valuation on an intraday basis in January 2022, but those gains were quickly erased before the stock could close above the threshold, and it ultimately fell nearly 30% in an ensuing year-long bear market.
A strong ecosystem of products led by the company's iPhone, iPad, and Services business helped drive consistent revenue and income growth during economic booms and busts and even a global pandemic, speaking to just how resilient the company's underlying business is.
Apple is now on track to generate annual revenue and income of $400 billion and $100 billion, respectively. And the growth could accelerate further if the company's recent product announcement takes off with consumers.
Apple recently unveiled its $3,499 Vision Pro headset, which offered investors a glimpse into the company's first ever virtual-and-augmented reality headset. While its sky-high price is seen as only appealing to early adopters, the company is said to be working on a lower-cost version for the masses.
But Wedbush analyst Dan Ives thinks its the iPhone that will continue to drive solid growth for Apple for years to come, pointing to the company' upcoming iPhone 15 anniversary edition as a likely catalyst that could continue to drive the stock price higher as older iPhone users upgrade their devices.
"We estimate roughly 250 million iPhones have not been upgraded in over four years and sets Apple up for a major installed base upgrade cycle heading into this anniversary 15 year release," Ives said in a recent note.
Also helping Apple's iPhone business is the fact that its average selling price continues to rise as it releases iPhones with larger screens and better cameras. The average selling price for an iPhone could approach $925 with the upcoming iPhone 15 release, according to Ives. The first iPhone was released in 2007 at a starting price of $499.
Ives said the next stop for Apple is a $3.5 trillion valuation, followed by a $4 trillion valuation that could come as soon as 2025.
It took Apple 42 years from its founding in 1976 to grow to a $1 trillion valuation when it hit that threshold in August 2018. The company surpassed a $2 trillion valuation just two years later, in 2020. Three years after that, the company is now worth $3 trillion.