Le Apple shares are in the wake of two decisive short-term events: the stock split and the launch of the first iPhone 5G. And a bullish rally on the stock has already begun.
The shares will be split 4 to 1 based on Friday's closing price
Shares of Apple Inc. rose to a record high on Monday, driven by the movement of investors who rushed to buy the stock ahead of the company's imminent stock split which is surrounded by bullish forecasts.
The stock reached a record price of $ 515,14 and pushed the company's market cap further above the $ 2 trillion mark before two key events. "We believe AAPL can continue to outperform its competitors and the S&P 500 in the short term as Apple approaches two key catalyst events: the 4-for-1 stock split on August 31 and the launch of Apple's first 5G iPhone in October," he wrote Katy Huberty, an analyst at Morgan Stanley bank, in a recent statement.
Excitement about the upcoming equity division, announced alongside the company's strong second quarter results released on July 30, helped to push the stock up 29% through last Friday.
Apple made history as the first US company to reach a market capitalization of $ 2 trillion
Apple has added $ 482 million in market capitalization since the division announcement, becoming the first US company with a $ 2 trillion valuation. The excitement surrounding the division could provide a short-term catalyst to push Apple's market capitalization beyond $ 2.127 trillion where it ended on Friday, according to Matt Maley, Boston-based chief market strategist at Miller Tabak & Co. .
"My experience says that when [stock splits] are announced, the stock goes up and when it actually happens [the split] occurs, the stock goes up again, but it usually drops and stabilizes shortly thereafter," he said. FOX Business, citing what he learned when he started working on Wall Street in the late 80s.
If the rally around the division dies down, the 5G cycle has the potential to generate more than 235 million iPhone shipments in fiscal year 2021, according to Huberty. The analyst argues that the stock could reach $ 681 in a bullish scenario as investors place a premium on Apple stock due to "greater confidence in the sustainability" of its long-term growth. Apple stock was up 69% this year through Friday, outpacing the S&P 5,15's 500% gain.
