With Thursday Close, Apple Just $9 Trillion from Becoming First $10 Trillion Company

iPhone X Makes the Money

Much was made of Apple’s run up to becoming the first company valued at a trillion dollars. On Thursday, August 2nd, 2018, the company became the first to both hit that magic number—and much more importantly, close above it. Shares of $AAPL ended the day at $207.39, a gain of $5.89 (+2.92%), on very heavy volume of 62.4 million shares trading hands.

For some context, those shares that were traded in just one day were worth $12.9 billion at the end of the day. Like, a bunch of men and women got together and handed each other $12.9 billion over the course of a few hours. It’s just crazy.

iPhone X Makes the Money

A Trillion Here, a Trillion There…

Apple has been on this massive share buyback tear, spending $20 billion of its own money snapping up shares in just the June quarter. In the March quarter, it spent another $23 billion, and it has plans to “aggressively” spend roughly $80 billion over the next three quarters or so.

Back in May, I argued that this epic share buyback effort could only mean that Apple is planning to release something that will move the needle, probably in the next 18-24 months. I hope that’s the case

But those share buybacks have also pushed the share price needed to hit a trillion dollar market cap ever higher. With the known share count of 4.83 billion as of July 20th, $AAPL needed to hit roughly $207.05 to hit the magic number. In reality, Apple has probably bought more shares since July 20th, so it’s really a little higher, but who cares because TRILLION DOLLARS, BABY!

::makes it rain::


John Martellaro made a point on Thursday’s TDO that a trillion dollar valuation doesn’t really mean anything in particular. And he’s right, mostly. We humans love nice round numbers, and a trillion dollars is mind boggling. But Apple was also the first company to be worth $993.8 billion, and no one celebrated that.

But hey, we cleared it, and the stock closed above (more or less) that value, and that may prove to be a psychological barrier with Wall Street that has now been overcome. Time will tell, but if so, $AAPL could finally get some love from Wall Street.

Just $9 Trillion to Go

Which brings me to my title. If you believe that Apple will release new products that will have a material impact on the company, Apple is worth more than a trillion dollars. If you don’t, it’s worth less. But a trillion dollars is still just a number.

Here’s what Steve Wozniak beautifully had to say about it on Thursday:

Of course I’m proud of Apple, but I don’t measure the world by human simplifications like round numbers. A company is great because it is great.

So true, Mr. Wozniak, so true.

But, hey, that’s all yesterday’s news. Literally. Now I’m focused on tomorrow, because Apple is just $9 trillion away from being the first company valued at $10 trillion!

*In the interest of full disclosure, the author holds a tiny, almost insignificant share in AAPL stock that was not an influence in the creation of this article.

5 thoughts on “With Thursday Close, Apple Just $9 Trillion from Becoming First $10 Trillion Company

  • “Apple Just $9 Trillion from Becoming First $10 Trillion Company”

    … And it’s just $999 Trillion from becoming the first one Quadrillion dollar company! 😉

    But seriously, the one Trillion dollar valuation is just another rung on Apple’s ladder of successes. It was a psychological barrier for some people, in the same way that the hurdle of breaking through the sound barrier was more psychological than attainable.

    But reaching that achievement of a one Trillion dollar milestone, cuts through a psychological barrier for many people who previously may have been less confident in Apple sustaining its long run of success in the future.

  • I’ve always felt a measure of ambivalence about Apple’s share buyback program.

    On the one hand Apple’s approach is strategic and opportunistic: they buy at prices that they believe undervalue the stock, so they are not using buybacks to prop up the share price (which is what a lot of self-dealing CEOs do to inflate their compensation).

    On the other hand, buybacks reward the wrong shareholders, the ones who are bailing out, not the ones who are in it for the long term. Yes, yes, I know that thinning the number of outstanding shares benefits those who hang on to their AAPL stock but there’s nothing like cold hard cash in your bank account. Cash is not subject to as much volatility as holding shares, especially AAPL stock.

    So my argument is nuanced. I’m not saying Apple should stop the share buyback program. But if they truly want to reward the people who are in AAPL for the long term, can they at least increase the amount that they budget for dividends? Right now, it’s a pittance compared to the billions they give to people bailing out on AAPL. Reducing outstanding shares raises the share price, but so does raising dividends. The advantage of the latter is that Apple rewards the long term share holder, which Apple claims is the type of shareholder that they want to encourage.

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