(Note: The author of this fundamental analysis is a financial writer and portfolio manager. He and his clients own shares of GOOGL.)

Apple Inc.'s (AAPL) days may be numbered when it comes to holding the title as the world's most valuable company. Apple left investors breathless as its market value more than doubled to more than $900 billion by mid-January from five years earlier. But Apple's stock has fallen since then and rivals are catching up, most notably diversified search giant Alphabet Inc. (GOOGL). All it would take is a 2.5 percent gain in Alphabet's shares - or a similar decline in Apples' stock - to displace the global iPhone, iPad and laptop maker as the No. 1 company by market cap. 

A first test of whether that change takes place will occur this Thursday, when both companies report quarterly earnings.

And the momentum, for the moment, seems to be in Alphabet's favor. Apple shares have fallen by nearly 5 percent since early November while Alphabet has surged by over 13 percent. That has shaved Apple's size advantage relative to Alphabet from about $175 billion to less than $24 billion. In racing terms, that puts Apple barely a nose ahead of its rival.

AAPL Chart

AAPL data by YCharts

Headwinds For Apple

Since displacing Exxon Mobil Corp. (XOM) in 2013 as the most valuable company, Apple's products, sales and market value have dominated the tech world and consumers' imaginations. But this year, Apple's earnings and share price are facing major challenges even as many investors expect Apple's iPhone to benefit from a super-cycle that would boost its stock. But sales of several key Apple products have stalled in the consumer marketplace - the most worrisome being reports of weak demand for the high-priced iPhone X model.

AAPL Market Cap Chart

Momentum Shift

Analysts are currently looking for Apple's earnings to rise by 25 percent, and revenue to climb by nearly 18.5 percent in 2018, according to Ycharts. But those estimates may prove to be too high should the newest iPhone continue to struggle. It's uncertain how Apple may or may not benefit from the recent changes in tax laws. 

Alphabet, by contrast, is benefitting from a number of positive trends. Its shares have surged as the company dominates the advertising and search landscape, and as its YouTube and Waymo franchises blossom. Analysts are looking for earnings to grow by nearly 30 percent in 2018, and revenue to surge 20 percent. The company's outlook has helped propel Alphabets stock higher in recent weeks. 

The question, in the short-term, is whether Alphabet's quarterly earnings this Thursday surprise analysts and boost Alphabet's stock enough to make it the world's most valuable company. Another scenario is for Apple's results to disappoint investors so massively that their market value slides to Number 2.

Stay tuned. No matter what happens, the race is likely to be neck and neck, and the victor will the prize by a nose.

Michael Kramer is the Founder of Mott Capital Management LLC, a registered investment adviser, and the manager of the company's actively managed, long-only Thematic Growth Portfolio. Kramer typically buys and holds stocks for a duration of three to five years. Click here for Kramer's bio and his portfolio's holdingsInformation presented is for educational purposes only and does not intend to make an offer or solicitation for the sale or purchase of any specific securities, investments, or investment strategies. Investments involve risk and unless otherwise stated, are not guaranteed. Be sure to first consult with a qualified financial adviser and/or tax professional before implementing any strategy discussed herein. Upon request, the advisor will provide a list of all recommendations made during the past twelve months. Past performance is not indicative of future performance.