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Apple is Officially Worth More than Microsoft

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Re: Apple is Officially Worth More than Microsoft

#21

Post by avar »

papachito wrote: post #15
ergo98 wrote: post #10

Earlier quoted context omitted.

Goldman Sachs has a P/E ratio of 5.94. Microsoft's P/E is heavily "discounted" because it's considered a sort of swan song of easy money (the Windows and Office empire that they've coasted on). Apple's is considered the beginning of things. Stock value today isn't based on today, it's based on "tomorrow".

> Apple's is considered the beginning of things. Who says that? They could be at the top of their game right now and not see more growth and stabilizing and/or decreasing in the future. There is no way to tell, otherwise you'd be very rich already ;) > Stock value today isn't based on today, it's based on "tomorrow". Who says that? Many believe that Apple stocks are overvalued today, that's for sure. Oh, and again, t…

Stock price isn't meant to predict the future, it represent trust in the future turning out well for investors.

Re: Apple is Officially Worth More than Microsoft

#23

Post by Perceval »

noarchy wrote: post #3
melling wrote: post #2

Some would argue that they were always worth more. :-) It's interesting that this happened without breaking Microsoft's 90% desktop monopoly. Apple got bigger but it wasn't to the detriment of Microsoft. They just grew into new markets.

I suspect that this was just a sound bite in 1997, but Jobs himself said it: "We have to let go of a few things here. We have to let go of the notion that for Apple to win, Microsoft has to lose."

Here's a video of that keynote: http://www.youtube.com/watch?v=PEHNrqPkefI

Re: Apple is Officially Worth More than Microsoft

#24

Post by TheSOB88 »

jpablo wrote: post #19
FraaJad wrote: post #12

Earlier quoted context omitted.

The problem with facebook is it does not produce any value unlike Microsoft and Apple. Both Apple and Microsoft's product help people create stuff, get things done, entertain themselves. Facebook does a tiny bit of entertaining and socializing, it is no where near MSFT or AAPL in terms of having a tangible impact on people's lives.

I'll bet facebook has more impact than Apple. Apple makes your iPod, that let's me listen to music. Facebook creates your social life (for a lot of people it does).

I disagree. For me, the only way Facebook helps me socially is as a sort of phone book and with events. Catching up over Facebook seems a useless event compared to conversing IRL. Besides, an inordinate amount of people use it as a game system with a leaderboard. Facebook's value isn't really social at all. It's pseudosocial.

Re: Apple is Officially Worth More than Microsoft

#25

Post by Perceval »

louislouis wrote: post #22

Smells like an Apple bubble?

Actually, their P/E ratio has been steadily declining over the past five years, even as their stock price has risen dramatically. Usually a stock is considered overvalued if the P/E ratio is really high. But this chart (stock price on top, P/E ratio on bottom) seems to indicate that AAPL is not being overvalued by the market as the stock price goes up: http://bigcharts.marketwatch.com/advchart/frames/main.asp?ti...

Re: Apple is Officially Worth More than Microsoft

#27

Post by raphar »

Jun8 wrote: post #5
melling wrote: post #2

Some would argue that they were always worth more. :-) It's interesting that this happened without breaking Microsoft's 90% desktop monopoly. Apple got bigger but it wasn't to the detriment of Microsoft. They just grew into new markets.

Exactly! One of the best essay in PG's H&Ps book in my opinion was the one that explains how winning doesn't have to be a zero-sum game, you can generate wealth. This seems a no brainer but a lot of people don't get it. Many predict that a similar thing will happen in the battle between Google and Apple.

It interesting view this google vs apple in: http://www.google.com/finance?q=NASDAQ:AAPL+goog

put the graph to 1y or 5y.

Re: Apple is Officially Worth More than Microsoft

#28

Post by fusionman »

If you consider the PEG ratio of both, you'll actually see that when taking growth rate into consideration, Apple is still cheaper than Microsoft...barely. So, if you put faith in PEG ratios, Apple is still a better buy. If you don't know what a PEG ratio is, check it out here http://en.wikipedia.org/wiki/PEG_ratio

Re: Apple is Officially Worth More than Microsoft

#30

Post by fusionman »

moron4hire wrote: post #8

Consider that Apple's P/E is 24.5 and Microsoft's P/E is 13.4. Basically, while Apple may be in demand right now, Microsoft is earning almost twice as much. Also, Microsoft pays a (albeit small) dividend, whereas Apple does not.

PEG would be a more appropriate way to compare the two...don't you think?

Also, earnings for MSFT are about $17B and AAPL is about $11B

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