Lost amid the talk of Apple's soaring market capitalization is the fact that the venerable IBM is starting to compete for the second-place spot behind the iPhone maker.
By the time the market closed yesterday, IBM's market cap, a measure of the value of a company--derived from the total shares a company has outstanding, multiplied by its stock price--hit $214 billion. Microsoft's market cap ended the day at $213.2 billion.
IBM's victory over Microsoft marked the first time since 1996 that Big Blue's value exceeded that of the software giant, according to Bloomberg, citing its own data.
However, it didn't take long for Microsoft to get it back today. As of this writing, Microsoft shares are trading at $25.43, and the company's market cap sits at $213.1 billion. IBM stands at $177.02 per share with a market cap of $211.4 billion.
Both companies have a long way to go to catch Apple, the most valuable company in the technology industry. As of this writing, Apple's shares are trading at a whopping $384.47, and its market cap stands at $356.5 billion. At that level, Apple is currently only trailing Exxon Mobil, which has a market cap of $358.5 billion, as the world's most valuable company.
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Apple's market cap growth over the last few years has been nothing short of astounding. Since 2007 alone, the company's market capitalization has more than tripled, and Apple has passed a number of prominent companies, including Google and Wal-Mart, to compete with Exxon Mobil at the top. Apple passed Microsoft in valuation last year.
Like Apple, IBM's market cap growth has resulted from strong financial performance and a soaring stock price. In the last five years, IBM shares have jumped 116 percent, due mainly to soaring profits, up from $10.4 billion in 2007 to nearly $15 billion last year.
Although Microsoft has similarly strong financials--the company tallied a profit of $23.2 billion during its most recent fiscal year, ended June 30--its stock price hardly moves. Over the last five years, Microsoft shares have declined just 7.6 percent, and in the last year alone, the firm's stock price is up only 3.2 percent.