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Apple becomes the first $1T company

washingtonpost.com

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Re: Apple becomes the first $1T company

#251

Post by lkrubner »

rayiner wrote: post #87
pliny wrote: post #56

>“Apple’s $1 trillion cap is equal to about 5 percent of the total gross domestic product of the United States in 2018,” said David Kass, professor of finance at the University of Maryland. “That puts this company in perspective.” The comparison would be Apple net income (~$50B) vs. GDP, not market cap (which has units of USD) vs. GDP (which has units of USD per year).

Or, the net present value of the US economy plus assets, which is probably pushing a quadrillion dollars.

No, 5 to 1 has been the ratio in recent decades. I know this was true in 1990s when I studied this issue, and it could not have changed that much in 20 years. So 100 trillion would be my assumption.

Re: Apple becomes the first $1T company

#252

Post by nostrademons »

trentmb wrote: post #222
pliny wrote: post #56

>“Apple’s $1 trillion cap is equal to about 5 percent of the total gross domestic product of the United States in 2018,” said David Kass, professor of finance at the University of Maryland. “That puts this company in perspective.” The comparison would be Apple net income (~$50B) vs. GDP, not market cap (which has units of USD) vs. GDP (which has units of USD per year).

A particular years GDP isn't a per year unit, is it?

It is implicitly, but this is often obscured because currency is both a medium of exchange and a store of value. Accounting makes the distinction between your income statement (which has a time period attached, usually either quarterly or annually, and is focused on dollars exchanged with other entities) and your balance sheet (which is a snapshot quantity at a particular point in time, and is focused on dollars stored). GDP is part of a country's income statement - it reflects how many goods & services were produced & sold within the country.

Re: Apple becomes the first $1T company

#253

Post by maym86 »

bepotts wrote: post #44
benologist wrote: post #3

Avoided the most taxes in history too!

It's legal to find ways to reduce your tax burden.

Large companies spend millions lobbying to keep it that way. It's not a accident that it's legal. They're not just innocently taking advantage of loopholes that just happen to be there. They help create them and keep then that way at the normal tax payers expense.

Re: Apple becomes the first $1T company

#254

Post by mercer »

linuxftw wrote: post #197
npunt wrote: post #169

Earlier quoted context omitted.

While phones were routinely 'free' or $99, iPods were wildly popular in 2007 and routinely cost $300+, and one of the three legs the iPhone stood on was being an iPod. It should have been a red flag back then if market researchers and the people that hired them didn't see this as a convergence of music player + phone markets; it was the point of the keynote ! I remember people complaining then that they had to carry…

It's easy to forget just how popular ipods were. I think you're right, that is a very important aspect of the original iphone.

let's not forget it was unveiled as a touch-based ipod + web browser + phone!

Re: Apple becomes the first $1T company

#255

Post by AlexC04 »

rainbowmverse wrote: post #249

Apple is worth $1 trillion in the same way an asteroid hurtling toward Earth contains $1 trillion in precious metals. Tim Cook has yet to prove he can do more than maximize profits while someone somewhere is working on the thing that'll undermine the source of Apple's value while they're not looking. edit: generalized away from a specific example because it distracted from the point.

I'm pretty much a microsoft fanboy but - We had a batch of surface devices at the office and they all had massive battery issues. Like that scary thing where it starts to expand and bend the metal.

I think we had to mail it back to the manufacturer in a specially designed hard-case.

With quality like that - I'm not sure they're being undermined that badly yet.

I think MS are doing other great stuff but surface laptop/tablets are probably not it.

Re: Apple becomes the first $1T company

#256

Post by tooltalk »

KaoruAoiShiho wrote: post #239
temuze wrote: post #171

Earlier quoted context omitted.

I think there's three big reasons. Reason #1: Apple has 243.7B in cash right now. That'll already push them to nearly Samsung's valuation. Reason #2: Samsung's business is more vulnerable. Most of their profits came from the chips division: https://money.cnn.com/2017/07/27/technology/samsung-profit-a... Samsung sells components to many companies, including Apple. In fact, Samsung makes more money from iPhone than the…

#1 is a good point. Samsung's cash pile is $40 billion, decent but quite a bit smaller. Apple should be worth more than Samsung, just the size of the difference seems a bit out of step. About this moat. A fab is not exactly a shoe, it's not something that anyone can just do. The idea that Apple would make their own memory is out there. Apple still uses TSMC or Samsung to make their SoCs, and will have to keep paying…

just to nitpick, Samsung's cash pile as of June 2018 is $83B, but once you combine all forms of assets (ie, inventories, PP&E, etc) it comes out to about $300B. Apple doesn't have large PP&E (their datacenters aren't worth much) and other forms of assets. Samsung made $50B in profit last year, but it also has much greater R&D and CapEx than Apple.

Re: Apple becomes the first $1T company

#257

Post by 24gttghh »

Analemma_ wrote: post #73
mikekij wrote: post #25

"A $600 phone?! Who's going to buy a $600 phone?!" -Steve Balmer

“No wireless. Less space than a Nomad. Lame.”

Ahh the Creative Nomad Jukebox Zen Xtra. What an awful name it had. An mp3 player one could slap a larger 2.5" HDD into, and with a replaceable battery. Mine still sits on my desk, a monument to a forgone era. The case front and back are aluminum and removable, which made it easy to spray-paint :)

Re: Apple becomes the first $1T company

#258

Post by coryfklein »

Isamu wrote: post #203

I dislike market cap as a measure of a company, as clearly a company can be wildly overvalued or undervalued. It is a not as if the "wisdom of crowds" has calculated the true value of a company. During some of the pre-crash days early in the century, publications would trot out companies ranked by market cap, as if that really meant something. All I remember is various of these companies going under in the crash, des…

How much is my desk worth on the market? However much somebody is willing to pay for it.

As the article states, Apple's "value" as a company comes from, in part, the fact that it's a good investment. Some may argue that "the fundamentals" of the balance sheets and whatnot doesn't justify a $1T valuation, but they would be missing the intangible parts of the business which cause it to be worth exactly that much.

Re: Apple becomes the first $1T company

#259

Post by TuringNYC »

sungju1203 wrote: post #247

Samsung is making much more Operating Income than AAPL. Why their market cap is so low?

Market cap is based on a half-dozen factors, but primarily a factor of

- assets (e.g., cash on hand and other things that can be converted to cash),

-Operating Income, and

- growth -- meaning how quickly the annual operating income can grow (my guess is Samsung's growth is lower than Apple's)

Re: Apple becomes the first $1T company

#260

Post by spuz »

pliny wrote: post #56

>“Apple’s $1 trillion cap is equal to about 5 percent of the total gross domestic product of the United States in 2018,” said David Kass, professor of finance at the University of Maryland. “That puts this company in perspective.” The comparison would be Apple net income (~$50B) vs. GDP, not market cap (which has units of USD) vs. GDP (which has units of USD per year).

The comparison is still valid even if the units don't quite match. For example, if you flip the comparison you get "The US's total gross domestic product for 2018 is equal to 20 times the Apple's total market cap" which is a pretty reasonable statement. If you want to talk about Apple's net income per year, that is a totally different statistic.
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