Apple is no longer the most valuable company in the world

(Patria) - Two tech giants are vying for the title of the world's most valuable company.

Microsoft has overtaken Apple for the first time since 2021 and become the world's most valuable firm, according to market capitalization, which measures the value and number of company shares, Reuters reports.

Microsoft, based in Redmond, Washington, surpassed Apple during yesterday's trading on the New York Stock Exchange (NYSE), when its value rose by 1.5% to reach $2.888 trillion.

Apple, based in Cupertino, California, fell by 0.3% with a market capitalization of $2.887 trillion.

Apple shares have fallen 3.3% so far in January, compared to Microsoft's 1.8% increase, reports Index.hr.

Apple's decline followed a series of rating downgrades and growing concerns that sales of the iPhone, the company's most recognizable product, will remain weak, especially in the key market of China.

"China could be a drag on performance in the coming years," brokerage firm Redburn Atlantic said in a note to clients, pointing to Huawei's renewed competitiveness and Sino-American tensions that have increased pressure on Apple.

Apple shares, whose market capitalization reached a peak of $3.081 trillion on December 14, ended last year with a gain of 48%.

That was lower than Microsoft's 57% increase, which in 2023 launched generative artificial intelligence (AI) powered tools, thanks to its connection with OpenAI, the maker of ChatGPT.

Microsoft has briefly taken the lead over Apple as the most valuable company several times since 2018, most recently in 2021 when concerns about COVID-induced supply chain shortages hit the stock price of the iPhone maker.

Currently, Wall Street is more positive towards Microsoft. The company has no "sell" ratings, and almost 90% of brokerage firms covering the company recommend buying its shares.

Apple has two "sell" ratings, and only two-thirds of analysts following the company recommend buying its shares.

Both stocks appear relatively expensive in terms of price relative to their expected earnings, which is a common valuation method for publicly traded companies.