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New products put Apple on track for $4 trillion valuation

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New products could push Apple towards a $4 trillion valuation, analysts and investors have predicted, after it became the first company to hit the $3 trillion mark this week.

Gene Munster, an investor at venture capital firm Loup Funds, said Apple could be worth $3.8 trillion next year as sales continue to soar past the records achieved in the pandemic.

Wall Street analysts have also set targets well above the $182.87 share price that left Apple worth $3 trillion.

Apple briefly traversed the threshold on Monday before falling below the mark. Shares dipped on Tuesday by more than 1pc to $179.64.

However, forecasters have said that entries into virtual reality and carmaking could send its value soaring well above $3 trillion.

In December JP Morgan set a share price target of $210, which would imply a valuation close to $3.5 trillion, while Wedbush Securities said this week that its “bull case” was $225 a share. Six research firms say the company’s shares are worth at least 10pc above their current level.

Mr Munster said the release of new Apple products such as augmented reality and virtual reality headsets would prompt investors to raise their growth forecasts. Meanwhile revenues from the iPhone, Mac computers and Apple Watch would continue to grow, putting the company close to the $4 trillion mark.

“We’re not there at four [trillion] yet, but we’re getting close,” he said. “2022 is not going to be the year of new markets creating new revenue for Apple. But I think it’s the year where investors get more comfortable that Apple will be involved in some new things that potentially could drive revenue and earnings higher.”

Mr Munster said the company would show early signs of entries into transport and the “metaverse”. “They’re just so big that Apple’s current $375bn business could be twice as big, based on these two markets.”

Apple, whose value sits well above its Silicon Valley rivals, hit the $3 trillion mark less than four years after becoming the first to crack $1 trillion, and 16 months after reaching $2 trillion.

It is expected to report record sales and profits for the final months of the year when it reports quarterly results in the coming weeks, due to stronger iPhone sales.

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