Apple (AAPL) Becomes World's First $3 Trillion Company

Apple Inc. (AAPL) briefly became the world’s first $3 trillion company on Jan. 3, 2022. The tech giant crossed the mark during intraday trading. According to reports, the stock price will need to cross $182.86 to sustain that valuation.

In August 2018, the iPhone maker became the first company to cross $1 trillion. It hit the $2 trillion mark on Aug. 20, 2020. As of this writing, Apple stock is changing hands at $181.94, up by roughly 2.5% from the start of trading.

A Pandemic Surge 

In some ways, Apple is part of a surge in stock prices during the pandemic. The company reported stellar results, with a 47% revenue increase from the previous year, during its last quarter. But it was also hit by a chip shortage that delayed the manufacture and release of notable products in its portfolio. However, investors in its stock seem to have taken in stride the pandemic-induced issues in Apple's supply chain.

Since the beginning of 2021, the iPhone maker's shares have jumped by 38%. Apple accounts for a significant percentage of holdings for major indexes. Therefore, the stock's gains have mirrored those of the broader market during a time of economic and technological change.

Even as it led the charge in technological change, Apple has itself changed with times. While the company's flagship product, the iPhone, remains a money-spinner, Apple's Services increasingly account for a major chunk of its profits. The latter includes revenues from its App store, music, and television streaming businesses.

According to analysts, Apple still has room to grow. Recently, Morgan Stanley analyst Katy Huberty bumped the firm's price target on Apple shares to $200 from $164. She provided two reasons for the positive assessment.

First, she said that analysts have failed to price in the impact of future product releases. "Despite a consistent and material revenue contribution from new products and services over time, Apple shares don't seem to bake in the impact from upcoming new product launches," she wrote. Second, Huberty believes that Apple stock will trade at a higher premium when the company releases an augmented and virtual reality product.

Wedbush Securities analyst Dan Ives has an Outperform rating for Apple stock based on demand for the iPhone 13. He stated that demand for the latest iteration of Apple’s best-selling product has outstripped supply and will provide "tailwinds" for the company's overall sales.