Until recently, a $1 trillion valuation would have seemed inconceivable for any company, Cramer said.
In March 2000, right around the peak of the dotcom bubble, Cisco's market cap reached $550 billion; the internet giant then proceeded to loose nearly three-quarters of its value over the next year.
"Investors are terrified of repeating that experience," Cramer said. "The notion that any company could ever be worth more than a half-trillion was considered dangerous, foolhardy, seditious, maybe the sign of a pending crash."
But once the $500 billion level was successfully breached, the market's tone changed, enabling juggernauts like Apple to surge toward $1 trillion.
And, Cramer added, Apple managed to achieve a $1 trillion market cap — the first U.S. company to do so — without being "hideously expensive," trading at only 15 times next year's earnings estimates.
The canny CAN SLIM investor should always be looking for firms with accelerating sales growth. This key bullish trait is shared by top stocks Apple (AAPL), PerkinElmer (PKI), SVB Financial (SIVB) and Square (SQ).
Accelerating growth means that sales showed a larger percentage gain in the latest quarter than in the prior quarter. CAN SLIM pioneer William J. O'Neil recommends strong and improving quarterly earnings, backed by sales growth of 25% in the latest quarter, or at least accelerating growth. At least three consecutive quarters of accelerating sales growth is a bullish fundamental metric shared by many of the stock market's big winners.
Apple Stock
Accelerating sales growth is one of the keys to Apple becoming the first ever trillion dollar stock. In the past six quarters sales have revved up from a meager 3% growth to a whopping 17%.
Apple stock rose 2.9% to 207.39 on the stock market today. Apple stock has pushed on since breaking the $1 trillion market-cap threshold, and its relative strength line is showing a pronounced upward trend. It has blasted above the buy zone from a six-week flat base with a correct entry of 194.30.
This is despite worries about sluggish iPhone sales. Due to this, the firm is relying on a continued boom in high-margin services revenue. Another issue for Apple stock is that, despite CEO Tim Cook gradually increasing the amount of revenue spent on R&D from 2.2% to 5.1% of revenue, the company has yet to introduce a "home run" product under his leadership.
PerkinElmer Stock
PerkinElmer stock has powered into buy zone after posting accelerating sales growth for the past four quarters.
The stock soared into buy zone Thursday after a 27-week consolidation, MarketSmith analysis shows. PerkinElmer stock rose 8.3% to 86.55. The correct entry point is 84.59. It made its big move after the company beat on earnings and revenue Thursday. EPS exploded 36% to 91 cents, while revenue jumped 29% to $703 million.
PerkinElmer stock has an impressive IBD Composite Rating of 94. This puts it in the top 6% of stocks tracked. The firm manufactures chromatographs, spectrometers, surgical lamps, optical and temperature sensors, and imaging readers.
SVB Financial Stock
The Silicon Valley Bank holding company has seen its sales accelerate for the past six quarters in succession. This has given SVB Financial's stock a strong tailwind as it has fought its way to big gains.
The IBD 50 member is working on a possible entry of 333.84, rising 2.3% to 320.81 on Thursday. It has made gains in the past three sessions and has retaken its 50-day line, a key technical support level. The firm beat on earnings and revenue last week.
SVB Financial stock boasts an IBD Composite Rating of 98. This puts it in the top 2% of stocks. It also ranks first in the Banks-Super Regional Industry Group.
While it is known as the "bank to the tech stars," SVB Financial also serves venture capital and private equity firms investing in the tech and biotech fields. It also offers private banking services for high-net-worth individuals.
Square Stock
Payment processor Square has posted accelerating top-line growth for the past six quarters. In the most recent quarter reported late Wednesday, revenue jumped 48%. Earnings also beat, though guidance was mixed.
Investors interested in buying Square stock may do best waiting for a new base to form. It is currently in profit-taking zone after breaking out from a 10-week cup base with a buy point of 58.56. Square stock vaulted 8.7% to 72.65. In addition, its fundamentals are not ideal, though its IBD Composite Rating is still good at 92.
The San Francisco-based firm makes credit-card readers that plug into mobile phones and tablets. In November, it set up a Bitcoin exchange so that users of its Square Cash app could buy and sell the digital cryptocurrency.
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Earlier today, Apple’s stock price briefly hit the magic number, which in this case was $207.05 per share. According to most estimates, that put Apple’s market cap at over $1 trillion, making it the first US-listed company to break into the four-comma club. Breaking that threshold (even just for a moment since the shares blipped back down) was obviously a huge milestone, but now the company has thoroughly etched its name into the record books by closing at over $1 trillion.
The stock formally closed at $207.43, giving the company a valuation just a fraction north of $1 trillion. The intra-day high was $208.38.
Apple’s stock has been buoyant ever since it released its fiscal Q3 earnings, which were mostly positive for the company. Although it missed its target on unit sales of the iPhone, which has long been Apple’s cash cow, a rise in the average selling price driven by the iPhone X saw revenues soar. The services division also had a stellar quarter, as Apple Music reportedly took over Spotify to be the number-one streaming service in the world.
Speaking to Bloomberg‘s Emily Chang in the past, Apple CEO Tim Cook reportedly said that “I don’t really think about[hitting $1 trillion]…I still view Apple as a pretty small company, the way that we operate. I know it’s not numerically, but the way we function is very much like that.”
Going forward, the big question remains whether Apple can retain its number-one spot in the market as the smartphone market continues to tail off. iPhone growth is not what it used to be, and with more and more users hanging onto their phones for longer periods between upgrades, Apple will have to find an alternate revenue source if it wants to keep investors happy. During the Q3 earnings call, Cook hinted to reporters that Apple’s long-rumored original content and streaming play might soon start showing dividends, and it’s been rumored to have self-driving car and augmented reality teams with good prospects in the pipeline.
