Apple $1 trillion stock market value could be years away

Fri Feb 13, 2015 2:07am EST
 
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By Noel Randewich

SAN FRANCISCO (Reuters) - Activist Investor Carl Icahn thinks Apple Inc is already worth over $1 trillion but others on Wall St. think it will take a few more years for the iPhone maker's stock value to get there.

With Apple's stock market value ballooning this week beyond $700 billion, larger than Switzerland's gross domestic product, activist investor Icahn said the technology company's shares should be trading at $216 apiece, equivalent to a market capitalization of about $1.26 trillion.

Icahn's opinion implies an increase of about 70 percent from Thursday's closing price of Apple's stock. And that's on top of a 65 percent surge in Apple's shares over the past 12 months, which dwarfed the S&P 500's 15 percent return.

“It wouldn't be outlandish for them to be at a $1 trillion market cap now,” said Mark Mulholland, a portfolio manager whose Matthew 25 fund is among the best performing large-cap funds over the last five years.

But like other portfolio managers consulted by Reuters, Mulholland believes it will more likely take two or three years to reach that level.

Fortunes wax and wane in the technology industry seemingly overnight; Apple teetered on the edge of financial ruin in the late 1990s and more recently it was partly to blame for the rapid demise of once-storied brands like Nokia and BlackBerry.

Maintaining its spot at the top of the global technology market and growing its now-record market value hinges in part on Chief Executive Tim Cook's ability to keep up the stream of game-changing consumer products launched by cofounder Steve Jobs.

Still, Wall Street appears sanguine in the short term.   Continued...

 
A customer is silhouetted while entering the Fifth Avenue Apple store shortly after doors opened for iPhone 6 sales in Manhattan, New York September 19, 2014. REUTERS/Adrees Latif