Tracking Apple’s Trend: Is $600 the Next Step?

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Apple (NASDAQ:AAPL) shares achieved a one-year high today of $595.75 on Monday. Apple’s share price has ranged from $388.87 to $595.75 over the past fifty-two weeks. Apple’s record one-year high may have been sparked by a recent report from market research firm Kantar Worldpanel ComTech that showed that the iPhone maker had boosted its market share in several key overseas markets during the March quarter. Apple’s smartphone market share in Australia jumped by two points year-over-year to 33.1 percent in the first-quarter of 2014. In five major European markets — France, Germany, Italy, Spain, and the UK — Apple’s share of the smartphone market climbed 0.1 percent higher to 19.2 percent. Apple’s growth in Spain was especially strong where the company boosted its market share by 4.5 percentage points to 7.6 percent.

Meanwhile, Apple continued its dominance of Japan’s smartphone market by growing its share by 8.6 percentage points to 57.6 percent in the first-quarter of 2014. Kantar Worldpanel ComTech global strategic insight director Dominic Sunnebo noted that Apple’s iPhone accounted for over forty percent of sales at NTT DoCoMo (NYSE:DCM), Japan’s largest carrier.

Although the positive Kantar Worldpanel ComTech report on Apple’s international growth may have ignited today’s 52-week record high, the Cupertino-based company’s recent quarterly earnings report appears to be driving the overall upward trend. Last week, Apple reported quarterly revenue of $45.6 billion and earnings per share of $11.62, handily beating consensus expectations of $43.7 billion revenue and $10.19 EPS.

As noted by CEO Tim Cook, Apple’s higher-than-expected results were driven by “strong iPhone sales and record revenue from services.” Apple sold 43.7 million iPhones last quarter, a March quarter record. Meanwhile, as noted by Apple vice president of finance and corporate controller Luca Maestri during the company’s quarterly earnings call, “Total revenue from iTunes, software and services was $4.6 billion, an increase of 11 percent year-over-year and an all time quarterly record.”

However, strong product and services sales weren’t the only announcements that ignited investor excitement. Apple also announced several changes to its capital return program that will return more cash to shareholders. Apple revealed that it was increasing its share repurchase program to $90 billion from the previously announced $60 billion level. Apple also boosted its dividend for the second time in less than two years, raising it by approximately 8 percent to $3.29. The company also indicated that it planned to raise its dividend on an annual basis.

Finally, Apple’s recent record high may have also been driven in part by the company’s announcement of a stock split. According to Apple, “Each Apple shareholder of record at the close of business on June 2, 2014 will receive six additional shares for every share held on the record date, and trading will begin on a split-adjusted basis on June 9, 2014. “ Although the split doesn’t change Apple’s market value, some analysts anticipate that the lower entry level stock price will increase overall confidence in Apple by allowing more small investors to have a stake in the company’s future. However, the stock-split announcement itself may have already positively affected investor confidence.

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