In a surprising turn of events, Microsoft has surpassed Apple and become the most valuable publicly traded company in the world after over two years. The shift in position is due to concerns over the demand for smartphones, which have weighed down Apple’s stocks in recent weeks.
Microsoft’s market capitalization reached $2.89 trillion, with the stock value increasing by 1% to $388.47 on Friday. In comparison, Apple only gained 0.2% and closed with a market capitalization of $2.87 trillion. This is the first time since November 2021 that Microsoft has closed with a higher value than Apple.
Analysts attribute Microsoft’s success to its strong performance and steady profit growth compared to Apple, whose growth prospects are causing concerns. According to David Katz, the director of investments at Matrix Asset Advisors, Microsoft’s clear strategy related to artificial intelligence (AI) is driving its growth and enhancing its long-term prospects.
While Microsoft and Apple were part of the powerful “Magnificent 7” rally in 2023, their fortunes have diverged this year. Microsoft experienced a 3.3% growth due to ongoing optimism surrounding AI, while Apple saw a 3.4% decline due to growth concerns and multiple downgrades by analysts.
The increasing support from Wall Street for Microsoft compared to Apple indicates that Microsoft will maintain or further increase its size. Analysts forecast that Microsoft has a growth potential of around 8% in the next 12 months, slightly higher than Apple. This could lead to Microsoft’s market capitalization surpassing $3 trillion, making it one of the two companies alongside Apple with such a milestone.
Microsoft and Apple still dominate the S&P 500 index, accounting for approximately 14% of the overall index value. Few other companies come close to their sizes, with Saudi Aramco, Alphabet Inc., Amazon.com Inc., and Nvidia Corp being valued above a trillion dollars. Meta Platforms Inc., which experienced significant growth last year, is the next closest but has yet to cross the trillion-dollar threshold.
The current development of Microsoft surpassing Apple reflects the changing dynamics in the technology sector. By focusing on AI and consistently fulfilling its plans, Microsoft has become a worthy competitor in the market.
The source of the article is from the blog maltemoney.com.br