Shares of Apple have surged by 35% this year, thanks to a rally in the technology sector, boosting the company’s market value by $690 billion, according to Bloomberg.
This rally in 2023 has brought Apple to the brink of reaching a historical market valuation peak of $3 trillion.
The significant growth is attributed to investor interest in the stable profits generated by the iPhone manufacturer and the massive cash flows of the large-scale company, coupled with reduced risks associated with potential recession, bank bankruptcies, and unresolved issues surrounding the US debt ceiling. Furthermore, Apple remains a favorite among institutional investors, hedge funds, retail investors, and Warren Buffett.
However, the company’s valuation is 28 times higher than projected earnings, and revenue is expected to decline this year. Apple has also increased dividends and announced plans for a $90 billion share buyback.
At the beginning of last year, Apple briefly surpassed the $3 trillion mark but was unable to finish the year above that level, as a downward trend followed, leading to a 27% decline in its stocks due to a sharp rise in interest rates. Currently, its market value stands at $2.76 trillion.
Apple has been favored by investors both during periods of risk appetite and when defensive strategies dominate the market. According to experts, Apple is equally capable of performing well in both risk and risk-free conditions. It offers significant growth potential, pays dividends, conducts substantial share repurchases, and maintains an incredibly strong balance sheet, all of which are attractive to investors.
