Apple is now the largest US company ever. Its stock market value was greater in nominal terms, although not in inflation-adjusted terms, than Microsoft was at its highest value of $616.34 billion in December 1999.
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Apple closed on Monday, August 20, at a value of $623.52 billion. Its influence on the US economy rivals that of GM, IBM, and Microsoft. Apple surpassed Exxon’s highest value last year but had still remained behind that of Microsoft.
This is in the face of the death of its founder Steve Jobs as well as the fact that the company has not introduced a major new product since it introduced the iPad in 2010.
Investors are wondering how long Apple can continue its valuation ride. The bigger a company gets, the more difficult it is to remain profitable and to grow profits as well as to maintain an inspirational culture both for employees and consumers.
In the sense of creative destruction, there may already be a product under development that will rival those of Apple. The nature of entrepreneurial business is that smaller companies create a winning service or product that enables them to grow faster than the larger behemoths.
But Apple seems to have a cult-like following and its products continue to experience strong demand. Analysts are saying it could become the first trillion-dollar company.
Another positive is Apple’s ability to pay a dividend for the first time in almost 20 years. Although Apple’s star may dim at some point, it doesn’t appear to be losing its luster any time soon.