Apple’s name has been at the masthead of the technological revolution since it started and analysts are now predicting that the upcoming iPhone 8 could propel the company’s market cap to the north of $1 trillion and can help it sustain that too.
According to a MarketWatch report, Apple’s third quarter results which were announced recently suggest that the stock momentum has added $56 billion to the company’s market cap.
Apple posted $45.4 billion in revenues for the third quarter with a seven percent year on year growth.
“With revenue up 7 percent year-over-year, we’re happy to report our third consecutive quarter of accelerating growth and an all-time quarterly record for Services revenue,” said Tim Cook, Apple’s CEO.
Analysts from RBC Capital, another investment service company, have predicted that Apple’s stock momentum will continue in the same fashion at least until the launch of their tenth anniversary iPhone 8 in September.
Post the launch, analysts predict that the company’s market cap will skyrocket.
“Apple has potential to achieve a $1 trillion dollar market cap and even surpass that over the next 12 to 18 months. We see upside occurring from multiple levers,” Amit Daryanani, lead analyst on the note, was quoted as saying.
The analyst pointed out that Apple’s shares which currently are valued at $160 will rise to about $192 to $195. The rise will depend on the rate of the company’s stock buybacks that will help them reach the $1 trillion mark.
“Those ‘levers’ to get to $12 per share in profit are revenue increasing from new iPhone models, including a higher-priced premium model, growing services revenue helping to expand profit margins, tighter cost control and strong stock buybacks,” Daryanani added.
Apple is rumoured to release three iPhone variants this September — the iPhone 7s, iPhone 7s Plus and iPhone 8. 41.03 million iPhone units were sold during the third quarter.
All of these variants are being tipped to come with a glass back which will facilitate the wireless charging feature and are probably going to cost upwards of $1000 — costlier than their previous devices.
The net income of the company was reported $8.72 million at $1.67 per share which is significantly higher than $7.80 billion net income last year at $1.42 per share.
“We reported unit and revenue growth in all our product categories in the June quarter, driving 17 percent growth in earnings per share,” said Luca Maestri, Apple’s CFO. “We also returned $11.7 billion to investors during the quarter, bringing cumulative capital returns under our program to almost $223 billion.”