Profits Down, Shares Up
Apple, the smart-phone and device mogul, has managed to rack up over 400 billion dollars worth of market capitalism throughout the year of 2019, even as its profits began to decrease and the new iPhone 11 has failed to meet expectations. The share prices have reached a high, up to sixty-five percent, closing on Friday with record-breaking numbers.
The higher prices that Apple racks up over Microsoft, the more certain Apple will be able to regain the title of being the most valuable listed firm in the world. According to Michael Kagan, a portofolio manager with ClearBridge Investments, “People are looking for certainty in an uncertain market. Investors love that Apple generates so much cash flow — it’s a cash machine even though it’s a relatively mature business.”
The gains have made a stronger impact due to the tiring year of 2019, and the disappointing results that followed this year’s fiscal reports. While the iPhone 11 has met the standards of Apple clients, their influence on the market is not appreciated or expected. The iPhone 11 is considered to be a competition, and not leading the technology field as a top product.
Apple in the Past Year
In the beginning of 2019, Apple has suffered from a dip in shares, due to the tensions that were occurring between China and the United States. Last year, in 2018, Apple went through plunge after plunge in earnings and profits, reaching an all-time low that was not seen since 2015. However, in 2019, there is some optimism that follows the launching of the 5G, concerning the revenues and the share prices. Apple has spent almost 320 billion dollars buying its own stock for the last decade, with Microsoft following close behind them.
Apple has been attempting to attain the type of revenue that is consistent, which is more suitable for investors. This is due to the fact that the company does not depend on the sales of hardware, but more of its services aspect. The technology and hardware company has also announced a subscription for streaming TV service, which will be in competition with HBO and Netflix.
Apple is trying to get back in the game through share prices, since that is where their earnings mainly lie. There are many other options that they are taking to be able to regain their title as the most valued company all over the world; the market is impatiently waiting for what will happen next.