Apple Value Touches $900 Billion as iPhone Demand Boosts Stock

Apple briefly became the U.S.’s first $900 billion company on the day its stores around the world were inundated with customers trying to get their hands on the new iPhone X, according to Bloomberg.

Demand for the handset has prompted Apple to predict record sales of at least $84 billion in the Christmas quarter. The shares gained as much as 3.7 percent to $174.26, briefly tipping Apple’s market capitalization above $900 billion.

Apple shares have climbed almost 50 percent this year on expectations for the new iPhone, which comes 10 years after the original device was released. Even with those gains and the record valuation, Apple still trades at just 19 times earnings. That’s a discount to Google parent Alphabet, which trades at 31 times earnings, Netflix, which trades at 200 times earnings, and Amazon’s 277 price-to-earnings multiple.

Technology companies’ ability to build loyalty for their products and services, and consistently attract returning customers, has seen them come to dominate American equity indexes: Apple, Alphabet, Microsoft, Amazon and Facebook are the five most highly capitalized stocks in the U.S. It was only in May that Apple became the first American company to cross the $800 billion threshold. Analysts expect Apple shares to rise by another 11 percent over the next 12 months.

While Apple generates about two thirds of its sales from the iPhone, CEO Tim Cook has over the past two years prioritized growth from services, which include Apple Music and iCloud. Not only do services generate more profitable revenue, they also tie consumers more tightly to Apple’s lineup of hardware products, making it harder to trade in an iPhone or iPad for a competing device.