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$600 Billion and Counting: Could Apple Be the First Company to Hit a $1 Trillion Market Cap?


When talking about Apple -- almost an anomaly to the broad market -- we need to start looking further out.

MINYANVILLE ORIGINAL For many investors, getting long Apple (AAPL) at this point is mentally challenging; with a $600 billion market cap, what can your return on capital realistically be at this juncture? The stock is far from being overbought both looking at either the standard deviation above its 50 day moving average or's proprietary countertrend indicator. First and foremost we are quantitative in our investment selection. Our proprietary systems went to a strong buy back when the stock was trading at $592.00. Even though we are first quantitative, we do look at other factors as well, such as fundamentals. The market does realize that the stock is fairly cheap both on a cash flow and earnings basis. But when we are talking about Apple -- which is almost an anomaly to the broad market -- we need to start looking further out. Below is a chart of Apple's correlation to the S&P relative to other tech names.

We all realize how competitive the smartphone and tablet market are, and truthfully as an Android (GOOG)-HTC phone user, I believe Apple has its work cut out for it with the iPhone 5.

So the real question is, can this $600 billion company pull ahead to $1 trillion in market cap with new disruptive technologies? Over the last year we have all heard the stories about a new Apple TV service/product that could revolutionize the way you access your programming. Producing a new TV in of itself is hardly disruptive. However, this week the Wall Street Journal has reported that the company is in talks with cable companies to form a partnership. Little details have been revealed, yet there is a lot of speculation about the possibilities of the company providing a set top box. We would be less inclined to buy the stock here based on this potential development. However, the iPhone 5 may be a game changer, as analysts believe this could be the largest product cycle yet for Apple's iPhone.

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