Now that the Nasdaq Composite Index has reclaimed the 5,000 mark for the first time in 15 years, what's the next big milestone for the stock market?
A market capitalization of $1 trillion for Apple, says USA Today's Matt Krantz
. The company's stock made a lot of hay last month by surpassing $700 billion. And its market cap now stands at $751 billion.
So a move to $1 trillion, assuming the share count doesn't change, would entail a 33 percent price increase for the stock — to $171.50 from $128 Wednesday.
Of course, that could take a while, given that the market as a whole historically returns only approximately 9 percent a year. But Apple has generated an annual return of 19.9 percent in the last three years.
"Apple continues to defy gravity and it is arguably a one-stock mania like we haven’t seen since the dot-com bubble," Krantz writes.
Analysts' consensus 18-month target for the stock is $136.08, according to S&P Capital IQ.
Apple's a "dynamo," thanks to its business model of controlling its hardware while leaving software open, UBS analyst Steven Milunovich writes in a note to clients, obtained by USA Today. He has a $150 price target for the shares.
Morningstar analyst Brian Colello
puts current fair value at $120 for Apple.
"We believe Apple's strength lies in its experience and expertise in integrating hardware, software, services and third-party applications into differentiated devices that allow Apple to capture a premium on hardware sales," he writes on Morningstar.com.
"Although Apple has a sterling brand, strong product pipeline and ample opportunity to gain share in its various end markets, short product life cycles and intense competition will prevent the firm from resting on its laurels, or carving out a wide economic moat."
Meanwhile, you can count Barron's columnist Jack Hough
as an Apple bull.
"Look for the stock price to rise to $160 over the next year for a 25 percent return including dividends," he writes. "Expect a big dividend hike when the company updates its capital-return program, likely in April. The current yield looks undersized at 1.5 percent."
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