Tags: Apple | Shares | stock | Trillion

Morgan Stanley: Apple Shares Could Break $960, Valuation May Hit $1 Trillion

Thursday, 15 March 2012 08:55 AM

Apple stocks could jump past $960 a share, up from about $580 today, which would value the company near $900 billion, says Morgan Stanley’s Katy Huberty.

The computer maker enjoys a market cap of $540 billion, but if Apple convinces more businesses to adapt its popular iPad tables and gets its iPhones running on faster wireless networks and in more emerging markets, then the firm's valuation could approach $1 trillion.

"Despite being well above investor expectations we view our CY13 bull case (of) $80 EPS/$960 valuation as reasonable," Huberty writes in a note to clients, according to CNBC.

Others have pointed out that it's not inconceivable for Apple to become a $1 trillion company.

"The stock trades at a 15 times trailing price-earnings ratio, which is about the average price-earnings ratio for the market as a whole for the past century. Needless to say, Apple is growing its earnings vastly faster than the market as a whole," Henry Blodget, a former equities analyst and CEO of Business Insider, writes in a Yahoo's The Daily Ticker column.

Furthermore, Apple's products themselves have room to grow.

"Macs, for example, still make up only about 10 percent of PC sales worldwide. iPhones, meanwhile, are only about 20 percent of the exploding global smartphone market, which itself is growing extremely rapidly. And Apple dominates the tablet market, which is still in its infancy," Blodget adds.

Add onto that Apple's steps take to roll out new products, television sets whispered to be one example, and the sky appears to be the limit.

"So it is not, actually, far-fetched to think that Apple's value could eventually hit $1 trillion or more," Blodget concludes.

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