By Subrat Patnaik and Michael Msika | Bloomberg
The rally in Apple Inc., the world’s most valuable publicly traded company, is showing no signs of easing. After closing at a record high on Wednesday, the iPhone maker’s market value is approaching that of Europe’s largest stock market: France.
The combined market value of companies listed in Paris was about $3.2 trillion as of Wednesday’s close, versus the technology giant’s $3.1 trillion, according to an index compiled by Bloomberg. Apple is bigger than all but the six largest stock markets in the world.
It’s not the first time the Cupertino, California-based company eclipsed Paris in value. The duo swapped positions a number of times during last year’s second-half selloff as central banks raised interest rates to tackle inflation.
The French stock market itself is at a record high this week, propelled by luxury-goods companies including Louis Vuitton owner LVMH and Birkin bag manufacturer Hermes International SCA. The stocks pulled back starting in mid-summer, only to rev up again in recent weeks as evidence grew that inflation is cooling and thus interest rates may have peaked, with no sign of a recession in the US.
In the US, that same backdrop has driven a renewed surge in technology stocks, especially the biggest companies. Apple has soared more than 50% in 2023, adding about $1 trillion in market value. Shares edged higher in premarket trading Thursday.
The recent surge for Apple is a big reversal from October, when the stock was pressured by concerns about revenue growth and sales in China.
“The bears on the stock are missing the structural gross margin expansion story,” Citigroup Inc. analyst Atif Malik wrote in a note, pointing to the iPhone’s premium positioning, an acceleration in services sales and commodity price benefits. “We expect the above trends to continue next year, and view AI Phones and Vision Pro adoption as potential upside catalysts,” he said, targeting share gains to $230.
Wall Street projects that the company’s revenue will re-accelerate in 2024 as demand for smartphones, laptops and computers rebounds, according to the average of analyst estimates compiled by Bloomberg.
(Updates with premarket stock move and Citi analyst comments.)
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