Apple regains No. 1 most valuable crown

Matt Krantz | USA TODAY

Apple may not have a new iPhone or watch to brag about yet, but at least it can say it's No. 1 with investors again.

Less than two months after Apple stock had fallen below $400 and seemed on a course for $300 or worse, the stock is back above $500 and looking like a market leader again.

And leading in a big way. The hottest stock in the Standard & Poor's 500 last index last week, up 10%, Apple is adding to its lead as the world's most-valuable company, a title it reclaimed from Exxon Mobil at the end of July after losing it this January amid a brutal selloff of the stock.

Friday, with shares closing up $4.42 at $502.33, Apple has a market value of more than $456.4 billion, easily surpassing the value of Exxon at $386.9 billion and No. 3 Google at $286.3 billion.

Returning to No. 1 is a clear reason for optimism for Apple shareholders. But the stock is still nearly 30% below its high of more than $700 a share.

The stock at the top of the market value charts has a "mammoth impact" on the markets because it sets the tone for industry leadership and affects the types of stocks that investors are looking for, says Howard Silverblatt of S&P Dow Jones Indices.

This horse race for Wall Street's No. 1 reflects:

* Apple getting a private investor bump. Shares of Apple got big momentum this week after famed investor Carl Icahn disclosed he was building a position in the stock, followed by word George Soros is buying, too. "The stock wanted to go higher anyhow, but (Icahn) pushed it," says Kim Caughey Forrest. Several private investors are eyeing Apple's mound of $150 billion in cash and investments as a potential windfall if released as stock buybacks or dividends.

* The woes of Exxon. The energy giant had ruled the No. 1 perch since 2007 before behind toppled by Apple in 2012. But the company sorely disappointed investors when reporting a 57% decline in earnings in its quarter ended in June 2013 of $6.9 billion. Analysts are now calling for Exxon Mobil to report 9.4% lower adjusted earnings per share in the current year. Exxon needs its shares to top $105 to beat out Apple at its current price, Silverblatt says. Exxon closed Friday down 25 cents at $87.91.

* One company bucking the struggling technology sector. Investors have turned sour on many technology stocks as earnings forecasts have moderated. Analysts are calling for 1.7% growth in technology earnings this year, says S&P Capital IQ, well below the expected 6.1% growth of the Standard & Poor's 500. Meanwhile, the Information Technology sector of the Standard & Poor's 500 is up roughly 10% this year, missing the S&P 500's 16% gain this year.

But despite Apple's recent stock gains, investors like Caughey Forrest don't think investors should get back in since the company relies on breakthrough products, which have been missing as competition intensifies. "Getting to the top is hard," says Silverblatt. "Staying there is even harder."