Shares of Microsoft and Apple Compete for the Title of Most Capitalized Stock on Wall Street Since the Beginning of the Year.
Microsoft’s stock market value crossed the $3 trillion (roughly Rs. 2,49,35,925 crore) milestone for the first time on Wednesday, retaining its place as the world’s second most valuable company, just behind Apple.
Microsoft and Apple shares have been vying for the top spot as the most capitalized stock on Wall Street since the start of the year, with the iPhone maker briefly losing its crown to the software giant earlier in January.
Shares of Microsoft hit a record high of $405.63, up 1.7 percent, enabling it to breach the $3 trillion market capitalization level. But it later closed at $402.56, valuing Microsoft at $2.99 trillion, just below the threshold price of $403.65 that would have kept it above $3 trillion.
Apple’s shares pared earlier gains and closed down 0.35 percent at $194.50, giving it a market value of $3 trillion, according to LSEG data.
Backed by its investment in ChatGPT maker OpenAI, Microsoft is widely seen as a frontrunner in the race for market dominance in the rollout of generative artificial intelligence (AI) among other tech heavyweights, including Google owner Alphabet, Amazon.com, Oracle, and Facebook owner Meta Platforms.
Using OpenAI’s technology, Microsoft has rolled out newer versions of its flagship productivity software products as well as its Bing search engine, which is expected to better compete with Google’s dominant search offering.
While Apple grapples with slowing demand for iPhones, especially in the competitive Chinese market where the company is offering rare discounts to spur sales, Microsoft’s success is attributed to its optimism in the field of Artificial Intelligence (AI). Stifel analyst Brad Reback notes that Microsoft has a clear AI story, unlike Apple, which is facing concerns regarding iPhone sales growth rates and market penetration.
With 54 analysts covering Microsoft’s stock, they have a median price target of $425, up from $415 a month ago. The average recommendation for the stock is ‘buy,’ according to LSEG data. Fueled by AI optimism, Microsoft’s shares surged nearly 57% in 2023 and have risen 7% this year. In contrast, Apple’s stock gained 48% last year but has seen only about a 1% increase year-to-date.
The coming weeks will test Wall Street’s record-high momentum as major US technology-related companies, including Microsoft and Apple, begin reporting their financial results.