Apple’s high-flying stock price is now well in excess of $500 a share. Some look for Apple to top $1,000 a share.
Possible? AAPL has doubled in share price five times in the past 10 years. Can Apple really, truly continue to grow so fast– revenue and profits– that a $1,000 a share price is possible?
Who’s buying AAPL? Who could afford it when the price reaches $1,000 a share?
Jack Hough in SmartMoney thinks the stratospheric stock price is more than possible because Apple is about to defy the law of large numbers and grow much larger.
That kind of growth and profits has never before been seen in an American business, so Apple is moving itself into rarefied air.
How can Apple do it? More revenue begets more profits. The Mac’s relatively small market share means plenty of headroom. Smart phones are growing like crazy as a percentage of all mobile devices, and Apple’s iPhone has, here it comes, plenty of headroom to grow.
Apple practically owns the new tablet market, which some predict will be larger than the PC market in a few years. If so, Apple’s popular iPad has plenty of headroom to grow.
More revenue, more profits, higher stock price.
Investors like to double their money. Apple would top $1,000 a share if the price doubles in a few years. So, who is buying Apple’s stock now? And who would buy when Apple’s share price closes in on $1,000?
Maybe the buyers will be the same kind of buyers who buy into Warren Buffett’s Berkshire Hathaway stock. Investors don’t seem to mind the $120,350 per share price. Apple and AAPL at $1,000 seems like a bargain.