NEW YORK – Apple is Wall Street’s all-time MVP – that’s Most Valuable Property.
On Monday, Apple’s surging stock propelled the company’s value to $624 billion, the world’s highest, ever. It beat the record for market capitalization set by Microsoft Corp. in the heady days of the Internet boom.
After a four-month dip, Apple’s stock has hit new highs recently because of optimism around what is believed to be the impending launch of the iPhone 5, and possibly a smaller, cheaper iPad.
Apple Inc. has been the world’s most valuable company since the end of last year. It’s now worth 54 percent more than No. 2 Exxon Mobil Corp.
Apple’s stock closed at $665.15. That was an all-time high, up $17.04, or 2.6 percent, from Friday’s close.
Microsoft’s 1999 peak was $620.58 billion, according to Standard & Poor’s.
In inflation-adjusted dollars, Microsoft was worth about $850 billion on Dec. 30, 1999. Analysts believe Apple’s stock has room to grow. The average price target of 38 analysts polled by FactSet is $745.80.
Despite the surge, Apple’s stock is not particularly expensive compared to its earnings for the last 12 months. The company’s “price-to-earnings ratio” is 15.6, compared to 16.1 for the S&P 500 overall. That suggests investors, unlike analysts, don’t believe the company can grow its profits much from current levels.
Microsoft had a price-to-earnings ratio of 83 at the 1999 peak. The stock was caught up in the Internet mania of the time and investors believed it could boost its future earnings massively.
Analysts believe the launch of a new iPhone in a month or two will be Apple’s biggest product introduction yet.
Scott Sutherland at Wedbush Morgan noted that some investors sold Apple shares last summer, when iPhone sales slowed down. Those investors missed out on a 50 percent jump in the stock price.
“This time around, investors are a little bit smarter across the board … they don’t want to be caught not involved in the stock on this next iPhone launch,” Sutherland said.