Apple is widely considered to be the premier consumer electronics company in the world. On Tuesday 25th of November the us based technology giants market capitalization crossed $ 700 billion, an unprecedented feat for any company. This rise in the trend-setting companies share price has been attributed to the demand for its new line of products. The iPhone 6 and 6 plus was launched in India on 17th of October and was sold out in several major retail chains almost immediately.
Apple is now the highest valued company in the world by a margin. To put that into perspective, Apples 700 Billion dollar valuation is almost double that of Exxon Mobil which in comparison stands at a modest 400 Billion Dollars. Analysts believe that this upward trend will continue and Apple will be the first ever “Trillion Dollar” company in the near future.
Much was asked about the caliber of Tim Cook when he replaced an ailing Steve Jobs in 2011. However, in the light of recent figures those trepidations have faded away.
While naysayers have contributed this spike in value completely to the holiday season, Billionaire investor Carl Icahn has actually valued each of Apple’s stocks at $203 instead of the current market value of $116. In an open letter to Apple CEO Tim Cook the activist hedge fund manager has called the tech company one of the best investments possible in todays market. He went as far as to say that the company has actually been drastically undervalued considering the success of the iPhone 6 and estimates the company is already worth a Trillion Dollars!
In response to Icahn’s letter, Apple released a statement talking about how they have issued buy-backs to the tune of 51 Billion Dollars over the past few years but were not in favor of his proposal to initiate a 150 Billion Dollar buyback yet. The company has promised to take a year on year approach to this issue and thanked Icahn for his contribution and suggestions.
BuyBack involves the parent company buying the shares back from the shareholders at a premium compared to the market rate. A company usually issues a buy-back when they believe the stock is worth more than the market price.
The iPhone Help
The iPhone Help