There’s no question in the minds of most reasonable investors that Apple Inc (Nasdaq: AAPL) is an undervalued company. Apple has mid-single digit revenue growth and AAPL stock trades at just 10x forward earnings (minus cash). However, there is a great psychological element involved with Apple stock, the fact that Apple is the world’s most valuable company and people often wonder how much money exists to drive Apple stock higher?

AAPL stock supports a $720 billion valuation. With it in uncharted territory, is there room for Apple stock to go higher? Or, does everyone already own it? After all, many would argue that AAPL stock was cheap in 2012, when it was both the world’s most valuable company and began a steep, unexpected downfall.

While finding a valuation ceiling may or may not be the reason that Apple Inc (Nasdaq: AAPL) remains undervalued, not many would argue that it is easier to plot a future path once that path has been traveled before. Apple stock is by all means in uncharted territory, but not for long.

This IPO will do wonders for AAPL stock

Saudi Aramco is the national oil company of Saudi Arabia, and it is prepping for the largest IPO in history.

The company already named JPMorgan, Morgan Stanley, and HSBC as underwriters as it assembles a who’s who list of top financial institutions to aid in its offering. Many like Citigroup have reportedly pursued a Saudi banking license in hopes of getting a piece of the massive IPO.

How big? The IPO figures Saudi Aramco offering 5% of its stock for $100 billion. If successful, Saudi Aramco would be valued at $2 trillion! That’s Apple nearly three times!

Granted, there is speculation that Saudi Aramco won’t raise $100 billion or support a $2 trillion valuation. Its financials are largely unknown, and a big part of the equation is a multiple of $8 to its 261 billion barrel reserve.

An $8 multiple is right in the middle compared to similar companies, and I believe fair given how meaningful Saudi Arabia is to the oil & gas industry. In addition to being far larger than similar companies, the cost basis for Saudi Aramco to produce oil is unlike anything else we have seen with companies in this industry.

Therefore, I think Saudi Aramco gets a $2 trillion valuation, and if so, the unknowns surrounding “how high can Apple go” no longer seem relevant. A $1 trillion market capitalization would no longer be unprecedented.

With investor psyche in mind, a $2 trillion market capitalization for Saudi Aramco is the best news that AAPL stock owners could hope for.