Apple Inc. (NASDAQ:AAPL) shares proved most Wall Street analysts wrong when the stock reached its highest level in 3 months.
The company’s investors have been overjoyed by the stock performance following the Wednesday rise which recorded a strong upwards movement by more than 6% in just one session. For a public company with the highest market cap in the world, 6% is a lot. Investors were also happy that the company performed better than analysts expected. The movement increased the company’s market capitalization by $33.35 billion and Apple’s shares were valued at $103.51 a share by the end of the session.
This happened despite speculation that the firm would not perform well because its sales plummeted to $42.4 billion, thus registering a 15% drop. Analysts in Wall Street missed the mark because they expected the firm to drop to $42.1 billion. The earnings per share were also higher than the estimated $1.39 despite registering a 27% decline. Apple’s iPhone sales were projected at 40 million units but the firm managed to sell 40.4 million units. The firm had previously announced to investors that it had another drop in its quarterly sales.
The recent movement in the company’s stock is a good indicator despite the fact that it is still a long way off from the market capitalization peak that it achieved in February at $774.69 billion. The firm’s current market capitalization is $571.57 billion. Analysts expected lower numbers because iPhone sales were slowing down.
The predictions were mainly because investors were aware that the company did not order as many chips as would be expected. They, therefore, thought that the firm did this because there was low demand for the handsets and it needed to clear its previous inventory. It, however, turned out that there was more demand than the company’s supply. The analysts failed to factor in that Apple itself might have underestimated the demand.