The strong results that Apple Inc. (NASDAQ:AAPL) recently released have sent its share price soaring and added $40 billion to the tech giant’s market value in the process. Already the highest-valued public company, the shares of the company closed Wednesday’s trading session on a high that was last attained on July 21, 2015. The market capitalization meanwhile reached $676 billion.
$40 billion increase in market value in one day
The $40 billion increase in market capitalization in just one day is roughly equivalent to the market value of Tesla Motors Inc (NASDAQ:TSLA) and is more than that of eBay Inc (NASDAQ:EBAY). Driving the increase in market value were the positive quarterly results that were announced on Tuesday after the markets had already closed. Revenues in the last quarter of 2016 rose by 3 percent year-on-year to reach a record of $78.4 billion. Analysts had predicted revenues of $77.3 billion. Profits for the quarter were $3.36 per share and this was an improvement of 8 cents from a year earlier. It was also 14 cents higher than what analysts had forecast.
Tim Cook, the chief executive officer of Apple, also revealed that in the same quarter the company recorded the highest sales figures for the Apple Watches as well as for the iPhone. The Mac computers, including the MacBook Pro laptops, also recorded strong sales. However, sales of the iPad continued on a downward trend.
Stock to keep appreciating
Following the impressive results, analysts are now predicting that Apple’s stock will appreciate even more. Steven Milunovich, a UBS analyst, joined other analysts in raising the price targets for the shares. The analyst argued that the base of customers with the potential to upgrade to the upcoming iPhone has grown as a result of increased sales of the iPhone 7. According to the UBS analyst, this was almost a guarantee that the next iPhone would be a hit.
“Based on the growing installed base and some recovery in upgrade rates, the iPhone 8 should result in double-digit [percentage] unit growth,” the analyst wrote.
In Wednesday’s trading session, shares of Apple Inc shot up by 6.10 percent to close the day at $128.75.
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