Apples Stock Market Value Falls Below 2 Dollar Trillion: On Tuesday, the value of Apple Inc.’s stock dropped significantly, bringing it below $2 trillion for the first time since March 2021. A year after becoming the first firm to exceed a $3 trillion market valuation, the iPhone maker saw a precipitous drop in its stock price.
According to Refinitiv Eikon, Apple stock dropped 3.7% to $125.07 after Exane BNP Paribas analyst Jerome Ramel downgraded the business to “neutral” from “outperform” and lowered his price target to $140 from $180.
Nikkei reported, citing anonymous suppliers, that Apple has instructed them to produce fewer parts for its earbuds, watches, and laptops, adding to investors’ concerns that a sluggish global economy and soaring inflation may be affecting demand for Apple devices.
Apple’s market valuation dropped from $2 trillion to $1.99 trillion as a result of the share price reduction. Ramel reduced his fiscal 2023 iPhone shipment goals from 245 million to 224 million units in light of supply chain concerns from manufacturer Foxconn and consumers’ reduced spending on high-end phones.
Apple’s current stock price gives it a value of around $1.9 trillion, putting it slightly ahead of Microsoft Corp’s $1.8 trillion valuation. Analysts estimate the Cupertino, California firm to announce a 1% decline in revenue for the December quarter in the coming weeks, with investors anxious about consumer demand, as reported by Refinitiv.
If that happens, it will be the first time since the March quarter of 2019 that Apple’s quarterly revenue has dropped. Bokeh Capital Partners’ Kim Forrest stated, “They (Apple) tend to tilt to the high-end consumer device buyer, but even that demographic might be being affected by the high price of everything.”
Stocks with high valuations were dumped by investors who were anxious about rising interest rates, which led to a severe sell-off on Wall Street last year, which hit IT industry heavyweights particularly hard.
As of today, the combined market capitalization of Apple, Microsoft, Amazon.com Inc, Alphabet Inc, and Meta Platforms accounts for approximately 18% of the S&P 500, down from as high as 24% in 2020.
Long-term Apple owners have nevertheless received outstanding returns despite the company’s 27% decline in value over the past year. When iPhone was introduced in 2007, investors who bought Apple stock at the IPO saw a return of over 4,000% (not including dividends) compared to 180% for the S&P 500.
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