Apple has become the first company to hit a market cap of $3 trillion, after its value increased by $1 trillion in less than 16 months.
The first company to be valued at $2 trillion was the iPhone maker, which became a $1 trillion company in August. The company's shares rose by 3 percent to $182.86 on Monday, but then fell back to $182 after a while.
At the end of October, Microsoft overtook Apple as the world's most valuable company. The crown was restored by a strong rally in November. Since November 15, it has added half a trillion dollars to its market value.
Only a few companies are worth more than $1 trillion. Microsoft has a market value of around $2.5 trillion, while the parent company of the internet giant is valued at $2 trillion.
Apple's stock climbed more than 30 percent in 2021, as it deftly handled the supply chain crisis and benefited from extra demand as customers upgraded their home offices.
Morgan Stanley analysts increased their price target on the stock to $200, arguing that investors had not priced in the launch of augmented and virtual reality devices.
Apple was upgraded to triple-A by Moody's in December, making it the third triple-A company. Apple is still rated AA+ by S&P Global.
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Tom Forte, analyst at DA Davidson, said investor enthusiasm for electric vehicles was spilling over into Apple's stock, on the hopes that the company will enter the car industry in the next few years.
There has been a lot of activity around Apple in the derivative markets, as traders bet that the stock would keep rising.
Tim Cook took over from Steve Jobs and Apple's market value has grown by over $2 trillion in a decade.
Cook has built his success on his ability to manage supply chains and sell products in huge numbers, while warding off regulatory and political threats in Washington, Brussels and Beijing.
Ben Wood said that Cook was seen as a safe but conservative bet. He has delivered something that is nothing short of amazing. He made the iPhone franchise the most lucrative item of consumer electronics in history.
Apple's stock price has increased about 500 percent over the past five years, compared to the S&P 500's 105 percent increase, according to Morgan Stanley analyst.
Apple's price-to-earnings ratio has risen to a historically high 30 from a three-year average of 23.4, according to a report.
Few analysts think the stock is in a bubble. 35 of the 45 analysts who cover Apple rate it a buy, and two rate it a sell, according to the report.
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The bullish outlook is due to how Apple has been revalued by Wall Street to account for its ballooning, high-margin services business that has delivered recurring revenues and severed its dependence on iPhone replacement cycles.
In the financial year that ended in September, Apple earned more than $1 billion of revenue a day and now has 745 million paying subscribers.
The services business has doubled in revenue in the past year. According to Evercore ISI, margins at the unit reached a record high in the previous quarter.
The pillars of the services business get upended by policy changes, which is one of the biggest risks to Apple and its stock price.
Legislators in Washington have raised questions about the estimated $8 billion to $12 billion payment each year that Alphabet gives for having Google Search as the default on its devices, while others have targeted the Apple App Store's business model of taking a 15-30 percent cut on some transactions.
Apple has been relatively unscathed so far. In the US, Epic Games sued it for operating an illegal monopoly, but lost on nine of 10 counts. A higher court granted Apple's request and delayed the lower court's order to open up the App Store to other payment platforms.
Apple has diversified its hardware offerings into Apple Watches and accessories.
The market for "wearables" like the Apple Watch hardly existed in 2014, but now is a $38 billion business, which is the size of a Fortune 120 company.
Additional reporting by Joe and Eric in New York.
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