(Bloomberg) — Apple Inc. made Wall Street history on Wednesday when its 2020 stock surge pushed the market value past $2 trillion, the first time a U.S. company has surpassed that level.
Shares of the iPhone maker rose as much as 1.4% to $468.65 in midday trading. The stock has more than doubled off a March low, in a rally that has been driven by strong earnings results and optimism over its upcoming 5G iPhone.
The gains have solidified Apple’s position as the most valuable company in the world. While Saudi Aramco briefly boasted a $2 trillion valuation in December, shares of Saudi Arabia’s national oil company subsequently dropped, and it currently trades with a market cap of around $1.8 trillion. Among U.S. companies, Apple is trailed by Amazon.com Inc. and Microsoft Corp., the second and third-largest U.S. stocks, both of which have market caps under $1.7 trillion.
Even amid a global economic slump that has led to record unemployment and sent many countries into recession, Apple last month reported quarterly sales that far exceeded forecasts as consumers snapped up new iPhones, Mac computers and iPads to stay connected during Covid-19 lockdowns. The pandemic also led to elevated usage of Apple’s services like iMessage, Siri and FaceTime.
At a time when technology’s top executives are being dragged in front of U.S. lawmakers to defend their companies’ spiraling size and influence, the sight of Apple doubling in a year is unlikely to burnish its image with critics. Its current market value is only slightly smaller than the entire Russell 2000 Index of small-cap stocks, a gauge that has fallen this year as pandemic shutdowns punish the U.S. economy.
Apple’s market-cap doubling to $2 trillion took two years, compared with the four decades the company took to hit $1 trillion in 2018.
Logan Purk, an analyst at Edward Jones, reiterated his hold rating on Apple shares, recommending that “new money look elsewhere in the tech space” for better opportunities. For Apple, “the big catalysts are fairly well priced in, the 5G iPhone especially,” meaning that “there aren’t a lot of stones left unturned.”
(Updates with details on Apple’s business starting in fourth paragraph.)
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