Apple’s stunning increase on Monday cause it to become the first firm to touch a $3 trillion value in the market.
The relentless growth of Apple’s stock shows the power of Apple’s capital return program.
Apple spends more on buybacks in comparison to other companies.
Share buybacks boost a company’s stock price by decreasing the supply of shares in the market.
Apple started paying quarterly dividends and again purchase its shares in March 2012.
Apple first hit a $1 trillion value in August 2018. Its stock is up 252% since then in comparison to the market rise of 200%.
The disparity is a direct consequence of its buyback program, which has decreased the company’s share count from approximately 19.4 billion in June 2018 to approximately 16.4 billion now.
“The recent rally in shares in part may reflect investor expectations of relatively stable demand and continued strong cash flows and a capital return for a stock that has performed largely in-line with the market,” Bank of America Securities analyst Wamsi Mohan wrote in a December note.