Apple's brand value races toward $1T even as market cap dips
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As Apple's (NASDAQ:AAPL) shares hover around a 52-week-low point, and its market cap gets closer to dipping below $2T, there is one area where the company can claim a victory in the eyes of the public: Brand value.
According to international branding and marketing company Kantar Brandz, Apple's (AAPL) brand alone is close to being worth $1T, making the iPhone maker the most-valuable brand in the world. Kantar said that Apple's (AAPL) brand value has risen by $50B since the end of 2021.
The Kantar study said Apple (AAPL) regained the most-valuable global brand title from Amazon (AMZN)
Additionally, a survey of 13,000 consumers and 300 consumer brands by the Prophet Brand Relevance Index ranked Apple (AAPL) as the No. 1 consumer brand around the world. Prophet said such a position has the potential to translate into stock market share gains, as the agency estimates that the top 50 brands have delivered 25% more value to investors than the benchmark S&P 500 (SP500) over the last decade.
Needham & Co. analyst Laura Martin said that the value of a brand, and especially that of Apple (AAPL), goes beyond its estimated financial worth.
"For consumer-facing companies, we believe brand value is a lead indicator of consumer adoption, churn levels, and pricing power," Martin said, in a research report. "Higher brand values lead to higher lifetime value [LTV] per user for consumer-facing products.
Martin said it's no secret why the Apple (AAPL) brand is equal to almost half the value of company's current $2.1T market cap: Apple (AAPL) customers remain intensely loyal to whatever the company puts its name and logo upon.
Martin said the "key indicator" of the Apple's (AAPL) value is "the 1.1B unique iPhone users owning 1.8B active devices" as of the end of 2021. "Deeper penetration of devices per home lowers churn and raises LTV per user," Martin said. "Services add high-margin incremental revenue to LTV, and also lower churn."
Martin holds a buy rating on $170-a-share price target on Apple's (AAPL) stock.
Still, through no real fault of its own, Apple (AAPL) has seen its shares take a hit this week and much of the tech sector has been battered during several sessions of big selloffs across Wall Street. Much of the decline has been due to growing uncertainty among investors about steps being taken to rein in inflation, and the possibility of the U.S. economy heading into a recession.