Apple’s Net Worth Is Exceeding $2 Trillion; What Are They Worth Today?
Apple is one of the world’s largest companies — No. 4 on the 2020 Fortune Global 500 list — and arguably the most well-known technology brand. In August 2020, Apple became the second company in the world to hit the $2 trillion value mark, behind Saudi Arabia’s Aramco.
Released in October 2020, Q4 results set a record for the September quarter, with $64.7 billion in revenue. These impressive results are just a piece of the puzzle in terms of evaluating the net worth of Apple, however.
To see how much Apple is worth, take a look at this snapshot of the company’s current state, along with a discussion of the company’s history, value and future outlook.
|Apple: Company Snapshot|
|Founders||Steve Jobs, Steve Wozniak|
How Much Is Apple’s Net Worth Now?
Apple’s net worth has exceeded $2 trillion, surpassing all tech companies. Many companies and individuals have suffered during the coronavirus pandemic of 2020, but Apple continues to shine. On Aug. 28, the company split its stock 4-1, and in its fiscal fourth quarter it set yet another revenue record. Through early November 2020, the stock had more than doubled in 2020 alone.
From a 52-week low of $53.15, Apple’s share price reached a high of $137.98 in 2020, a jump of more than 150%. This put the company’s market capitalization at over $2.4 trillion during the year. Market pundits use this figure to express how much a company is worth.
What Is Market Capitalization?
Market capitalization is simply the number of outstanding stock shares a company has issued times its current market price. So, for example, if a company has issued 1 million shares of stock and its share price is $50, the company has a market capitalization of $50 million. Apple currently has about 17.528 billion shares outstanding, so 17.528 billion times the closing stock price of $118.69 on Nov. 6 equals about $2.08 trillion.
Market cap does have its drawbacks as an evaluation method, however. For starters, market cap changes frequently, and it’s closely tied to the company’s current share price. It doesn’t take into account any of the direct financial metrics of the company, such as earnings per share, growth rate or book value.
By way of comparison, the price/earnings ratio, which is another popular valuation method, is also closely tied to a company’s market share price. The P/E ratio also relies heavily on a company’s earnings, which some investors feel is a more important determinant of a company’s valuation.
Apple’s Market Cap Range
Apple’s market cap varies from moment to moment based primarily on its share price. Although an increase in outstanding shares could also increase its market cap, that type of change occurs far less frequently than a change in share price, which can occur in less than one second. Here is Apple’s share price range over the past 52 weeks:
Share price: $53.15 – $137.98
As a result, Apple’s market cap over that same period has also fluctuated in this range:
Market cap range: $931,624,574,100 – $2,418,542,967,720
With such a wide fluctuation in share price, Apple’s market cap has also been extremely variable.
Calculating Apple’s Net Worth
In its simplest form, net worth is a company’s assets minus its liabilities. By this metric, Apple’s net worth as of the quarter ending Sept. 30, 2020, was $65.339 billion.
|What Is Apple Worth Now?|
|Share Price, 52-week range||$53.15 – $137.98|
|Market Cap, 52-week range||$931,624,574,100 – $2,418,542,967,720|
|Fiscal Year 2020 Revenue||$274.515 billion|
|Fiscal Year 2020 Profit||$57.411 billion|
|GOBankingRates’ Evaluation of Apple’s Net Worth||$485,716,333,000|
Of course, methods of determining the value of a company are wide and varied, each with its own merits and blind spots.
GOBankingRates uses company data to calculate net worth in a slightly different manner. The GOBankingRates company net worth is a calculation of a company’s worth based solely on concrete, measurable figures like assets and revenue. It’s a more conservative valuation than most, taking into account only full-year profits and revenue from the last three years and the company’s assets and debts.
By this GOBankingRates metric, Apple’s net worth is currently $485,716,333,000.
Founders: Steve Jobs and Steve Wozniak
Steve Jobs and Steve Wozniak met through a mutual friend and bonded over their love of technology. The two Steves co-founded Apple in 1976, laying the foundation for what would become the world’s most profitable company.
Jobs would ultimately be fired from his own company in 1985, an anecdote he shared in his famous 2005 Stanford commencement address along with his comeback story. Tim Cook was named CEO in August 2011.
According to Forbes, Steve Jobs’ net worth at the time of his death in 2011 was $7 billion.
Key Product Lines Contributing To Revenue
Apple is a consumer products juggernaut. It makes a wide variety of communications devices, personal computers, digital music players and other technological gadgets. Some of its most well-known products are household names, including the following:
- Apple Watch
- Apple TV
The company also offers services, from iCloud and Apple Pay to its iOS operating system, among others.
Here are some of the earnings highlights from Apple’s fiscal fourth quarter ending Sept. 30:
- Quarterly earnings per diluted share of $0.73
- International sales accounted for 59% total revenue
- $22 billion returned to shareholders during the quarter
- All-time records for revenue, earnings per share and free cash flow
For the company’s most recent year-end, Sept. 30, the company reported an annual net income of $57.411 billion.
Current Top Shareholders
The top 10 shareholders of Apple stock are all asset managers/mutual fund companies. As a group, institutional and mutual fund shareholders own 60.26% of all Apple shares, with just 0.29% held by individual shareholders. Here’s what the top shareholders list looks like:
Apple’s Top Shareholders:
- The Vanguard Group, Inc., 7.12% of shares
- Berkshire Hathaway, 5.66% of shares
- BlackRock Fund Advisors, 4.20% of shares
- SSgA Funds Management, 4.09% of shares
- Fidelity Management & Research, 2.03% of shares
- Geode Capital Management, 1.45% of shares
- T. Rowe Price Associates, Inc., 1.34% of shares
- Northern Trust Investments, 1.24% of shares
- Norges Bank Investment Management, 1.08% of shares
- Wellington Management Co. LLP, 0.75% of shares
Any of these shareholder percentages can change at any time, even dropping down all the way to 0%. Apple is a perennial Wall Street favorite, so these percentages may hold, but if the company’s fortunes turn sour, institutions may bail out at any time.
How Does the Future Look for Apple?
Apple has had a great run in 2020, but the company has been a long-term success story as well. With a rabidly loyal consumer base and a wildly popular product line, Apple’s business model seems poised for further growth in the future.
The consensus rating from 12 analysts covering Apple stock is “strong buy,” although their composite price target of $126.75 is not that far above the stock’s close in early November 2020. However, the company continues to post record revenues and profits, and unless it takes a major misstep with its product line, its success seems likely to continue.
Is Apple Worth the Money?
Apple has been a great bet in 2020, but with a stock price that has more than doubled over the year, it can no longer be considered “cheap.” However, analysts still have a “strong buy” rating on the stock, and momentum may keep pushing this stock higher.
Share price is just one of the variables you should consider when investing in a specific stock. Your financial situation plays a large part in determining whether or not you should invest in stocks at all — let alone invest in a specific stock like Apple. Working with a fiduciary financial advisor is a good way to delineate your investment objectives, risk tolerance and personal financial situation to determine if investing in stocks is a good match for you.
This article has been updated with additional reporting since its original publication.
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