Apple becomes first company worth $800bn

Source: theguardian
Date: 10th-may-2017 Time:  7:40:07 pm

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Apple has become the first company in history to top the $800bn mark in market capitalisation, slightly more than two years after it crossed the $700bn threshold.

The iPhone maker’s shares have gained 33% this year and almost 50% since the US election in November. Shares closed at $153.99 on Tuesday.

The company represents about 4% of the $21.7 trillion that makes up the entire S&P 500 index, which itself hity an all-time intra-day high on Tuesday of 2,403.87.

“It’s just reflective of how powerful a franchise it is. It may be the most powerful franchise in the country today,” said Rick Meckler, president of LibertyView Capital Management in Jersey City, New Jersey, whose firm does not own the stock.

“Considering that it has a limited number of products, it has really dominated that market in a way that few companies have, and it’s been able to retain margins despite lots of competitors.”

If Apple continues on its growth path, the company’s market cap – the total value of all its shares added together – will top $1 trillion later this year.

Stock buybacks have also bolstered Apple shares, with the company reducing its actual share count by 20.9% and the average diluted shares outstanding by 20.5% over the past four years, according to Standard & Poor’s data.

The closing market cap of $802.8 billion was larger than the economies of 45 of the 50 US states, topped only by Illinois, Florida, New York, Texas and California.

Billionaire Warren Buffett, whose Berkshire Hathaway has disclosed a stake of roughly $20bn in Apple, said on Monday he had grown more fond of the company because he could “very easily determine” the iPhone maker’s competitive position “and who is trying to chase them”.

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