Apple Inc. (NASDAQ:AAPL) has witnessed phenomenal growth in the past decade, and it continues to surprise everyone with its stupendous growth rate. Its exceptional stock performance has supported substantial gains in the Standard & Poor 500 index. Apple’s effects cannot be ignored.
Now many strategists and analysts are trying to find out how much the tech heavyweight affects S&P 500 (INDEXSP:.INX), so they calculate their earning expectations for S&P 500 minus Apple Inc. (NASDAQ:AAPL). It gives a better understanding about the broader market, without one company reorienting the final results.
Since the financial crisis, Warren Buffett's Berkshire Hathaway has had significant exposure to financial stocks in its portfolio. Q1 2021 hedge fund letters, conferences and more At the end of March this year, Bank of America accounted for nearly 15% of the conglomerate's vast equity portfolio. Until very recently, Wells Fargo was also a prominent Read More
Howard Silverblatt, an S&P index analyst, told in an email yesterday that S&P 500’s month-to-date (July 20, 2012) gain is 1.05%, but if you exclude Apple, the figure comes down to 0.86%. It means Apple alone, contributes 20 percent to S&P 500’s gains. The year-to-date gains stand at 9.5%, but it shrinks to 8 % without Apple.
The performance of S&P 500’s technology sector is completely at the mercy of iPhone maker. If you exclude Apple, the technology sector’s performance will be in negative territory for July. With Apple, the sector is up 1.06% month-to-date (July 20, 2012), and down 0.14% without Apple. The year-to-date statistics show a huge difference: Up 13.9% with Apple, and a gain of meager 5.91% without it. The tech giant contributes a whopping 57 % to S&P 500’s technology sector gains.
Apple is the world’s most valuable company, with a market capitalization of $565 billion. Its market value is about 40 percent more than that of Exxon Mobil. In case you think Apple is way too dominant over the index, there is another surprise: Eric Jackson of Ironfire says that Apple stock prices will shoot up to $1650 by 2015!
Maybe now Apple should become its own stock index, instead of being a part of S&P 500?