Apple’s march to become the world’s first trillion dollar company

“Apple is on track to become the first trillion dollar company in the world, with a $920 billion market cap and a cash pile of hundreds of billions after $100 billion in expected stock buyback,” Erica Pandey reports for Axios.

“Warren Buffett thinks Apple is the best investment, including for Apple itself, and he recently upped his stake in the company to nearly 5%,” Pandey reports. “Charles Munger, his business partner, backed him up, saying, ‘I think we’ve been a little too restrained… I wish we owned more of it.'”

“Apple’s stock surge — coming off rave reviews from Buffett — could propel it to the one trillion mark by the end of the week,” Pandey reports, “but its stock price has rallied to all-time highs before, only to come back down to Earth.”

Read more in the full article here.

MacDailyNews Take: If not by “the end of the week,” sometime this year certainly seems plausible. Would that Steve were here to see it.

Trillion, schmillion. Over time, Apple will go much higher than that. The company is currently horribly undervalued.MacDailyNews, March 1, 2018

The next ten years are going to be absolutely amazing for Apple. The company has just started to really get going!MacDailyNews, August 2, 2017

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  1. I’ve thought about this and decided such landmarks are meaningless. Given the rate of inflation we’ve seen this century, Apple really aren’t on the cusp of anything, relatively speaking. It’s both sad and ironic that Apple is lauded for its bottom line while contributing so little of genuine usefulness in their Jobs-less form. It’s a sad commentary on the state of our society, too. Apple used to sell tools a person couldn’t do without, now they sell gimmicky junk that nobody really needs. It is precisely the opposite of the mentality of the ‘old’ Apple, and I think most of their employees are too young to even comprehend that former sentence.

    1. Thinking Different is no longer the mantra or Prime Directive at Apple. Iteration and imitation has replaced innovation.

      The company grows more bloated by the day and is becoming the tech version of a 1960’s Conglomerate and we all know how well those worked out (they did not). Ask anyone about how well Harley Davidson did as part of AMF or Columbia Pictures under Cocoa-Cola or Time-Warner as part of America Online. Honeywell does not make Donuts and Ford does not make Bowling Balls. I am pretty sure Apple should stay out of the content business.

    2. impressions, but “gimmicky junk” to characterize Apple’s products. First, that’s complete hyperbole from, I suspect misplaced personal angst? Think about it, the iPh ranks #1 in the world. People are spending $1000 for just pleasure, hobby, or simple just because? Behind your statement belies the thinking that YOU know reality and others are remiss. Could one do w/o these items? Sure. I could do w/o my electric stove and start cooking over a campfire too. I’ll drive my car into the river tonight and make a 100% commitment to my slew of bikes.

      We both share a frustration w/ what Apple has become…”just” a money machine. I have to remind myself that that’s what business is, at the core. If wonder can be added to the mix, like powerful life inspiring credo, amazing come back story, products with a seemingly magic quality enabling an apparent magic to enter into user’s lives…I’ll take that instead. I’m still in denial, but sorry to say, I think the poet and real poetry is gone. The company is now strong like an oak, but is also being lead by a piece of wood.

  2. Congratulation to Apple, it is an achievement. However as James says, these numbers are meaningless. Apple needs to chase higher quality software and hardware and stay strong. In such departments, Apple has been lacking lately.

  3. Many people eagerly watch a car’s mileage counter roll over from 99,999 to 100,000, others have a big celebration when a person reaches 100 years and others want to be the first person to climb a previously unclimbed mountain.

    Being the first trillion dollar company is an interesting milestone and Apple may well be the first to get there, but others will follow ( as is so often the case with Apple ).

    1. would you, did you watch the zeros accumulate as your bank account approached 1,000,000? Of course you did and with great anticipation, I suspect.
      1st child, 1st baby/adult tooth, 1st car, 1st million, 1st period, 1st real girl/guy friend, 1st real job, 1st….
      Humans love “markers.” They rarely change the life’s direction, but they confirm our place in/on The Timeline. I was one of those who was very interested in “being there” when my odometer (s) “achieved” the special 100k’s. I probably will do so going forward too.

  4. It’s quite likely Amazon will beat Apple to the trillion dollar mark. Amazon’s share gains are unstoppable while Apple goes up and then immediately falls. Most of Wall Street is betting on Amazon to beat Apple because they see Amazon as a more deserving company to hold the market cap crown.

    Jeff Bezos is the most revered CEO on Wall Street and the big investors absolutely worship the man and his aggressive qualities. Tim Cook is basically a 98 lb. weakling when compared with Jeff Bezos financial muscles.

    Apple needs to buy off those outstanding shares so it probably benefits Apple shareholders to let Apple’s share price fall back to the $170 range. Even now, it appears Apple investors are starting to balk at Apple’s high price. Apple’s P/E actually got into the 19 range and that’s much too high for Apple. As they always say, it’s pullback time for Apple.

    Big investors would much rather pay $1600 a share for Amazon than $180 a share for Apple. Most big investors prefer revenue growth over dividends by a wide margin. Apple is far too conservative as a company and not worth most big investors’ time or money. Buffett’s thinking just happens to be different from most big investors.

    1. Maybe you are right. But probably not. Right now Apple is $185.16, and that’s only $6.64 from the trillion dollar threshold. That’s a 3.5 increase in stock price. Not likely in one day, but it could happen this week or next.

  5. When will they EVER learn that essentially, buybacks do not affect the market valuation of a company. Share price goes up (good for me) but share count goes down (I don’t care).

    1. Don’t forget that whenever Apple buys back shares, it no longer has to pay dividends on those retired shares, therefore the dividend gets shared between fewer outstanding shares. which is also good news for investors holding AAPL.

    2. but the math of share buy backs does show value. It’s not a matter of “if” but how much and that relates to your holdings. I’d say with confidence that Mr. Buffet likes this choice. Owning 5% of AAPL, he is sure to see material benefit.
      Alan’s comment about no divis paid to retired shares is a great point, as it shows the huge savings to the company, hence increased value to you. Ultimately, it will also allow/translate to increased divis in the future…albeit requiring a longer hold and patience.

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