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Alphabet Becomes the Most Valuable Public Company in the World

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Re: Alphabet Becomes the Most Valuable Public Company in the World

#151

Post by jcsnv »

aqzman wrote: post #86

Very impressive. I remember being a young teenager when Google first went public, and around the same time my parents were looking at investing a moderate amount of money (around 10K, if I remember correctly) in the stock market. I suggested they buy stocks in Google, they didn't take my advice, which I don't blame them for as taking investment advice from a 14 year old typically doesn't end well. It will be very int…

I remember being in a situation similar to that! Google's $100 IPO price looks like a steal now.

Re: Alphabet Becomes the Most Valuable Public Company in the World

#152

Post by azinman2 »

whitegrape wrote: post #53
cryptoz wrote: post #35

The comparisons between Google and Apple aren't as apples-to-apples as everyone in the media seems to think. If we're talking about the future of these companies, and their earning power, they are situating themselves very differently. Apple is really a consumer electronics company, Google is an artificial intelligence company. And investors think more money will be in the future of AI instead of consumer hardware an…

Nerds have known for years that Google is really an AI company, but do investors really see things that way yet? The stock didn't go up with the announcement of AlphaGo, though that could just be because they think that particular AI work won't give Google any competitive advantage in future revenue...

It's been a machine learning company. We'll see what the shift to AI looks like, but those are two very different things.

Re: Alphabet Becomes the Most Valuable Public Company in the World

#153

Post by jasode »

mwfunk wrote: post #97
jonknee wrote: post #47

Earlier quoted context omitted.

Why? It's obvious that is where they are going.

Calling someone an "X company" means that they make their money from X. There are aspects of AI in targeted advertising, but not enough to call them an AI company rather than an advertising company. It doesn't really matter where they're going- that's what they aspire to be, not what they are. If you judge companies based on their aspirations, you end up judging them based on their most positive and idealistic versio…

>Calling someone an "X company" means that they make their money from X.

It doesn't necessarily mean that.

It's more common to associate "X" with their business competency.

If we always insist on X to be only defined by revenue, we then get the following type of soundbites that we pat ourselves on the back for:

- McDonalds is actually a real estate company and not a hamburger company because they make more money from rent than from food

- General Electric is really a bank because GE Capital has higher revenue than GE Aviation or GE Energy

- Harvard University is really a hedge fund and not a school because the endowment income is greater than the tuition paid by students

- Lebron James is actually an advertising spokesperson instead of a basketball player because he gets most of his money from corporate endorsements instead of the NBA player contract. Same thing can be said for NASCAR drivers and Olympic athletes.

Are the twisted examples above really how we categorize companies/celebrities? We don't label NY Times, National Geographic, and NBC/CBS/ABC/Fox as "ad companies". Instead we respectively call them "newspaper", "magazine", and "tv networks". Being a conduit for ads does not define each of them as an ad company.

It's much more reasonable to think of Google Inc as a AI/search/maps/cloud company that happens to get most of their revenue from ads. They are not an "ad company".

We don't compare McDonalds with Donald Trump development properties. We compare McDonalds with Burger King. We also don't compare Google Inc with Omnicom Group; instead we compare Google Search with MS Bing, and Android vs iPhone, and other technologies.

Re: Alphabet Becomes the Most Valuable Public Company in the World

#154

Post by dragonwriter »

tosseraccount wrote: post #144
rjvir wrote: post #139

According to Google Finance, it appears that Alphabet has a market capitalization of $517B, which is far different than the $558B quoted in the article. This does not appear to be a temporary fluctuation. https://www.google.com/finance?q=NASDAQ%3AGOOGL Am I missing something? Based on the current market cap numbers on Google Finance, Apple is still higher than Alphabet.

Need to combine Google/Alphabet share classes.

No, the reported market cap on Finance already does that; the after-hours trading explanation seems the better explanation.

Re: Alphabet Becomes the Most Valuable Public Company in the World

#155

Post by czhiddy »

nl wrote: post #124
czhiddy wrote: post #111

Earlier quoted context omitted.

If you add in the same comparison to Facebook's numbers, the valuations look even more puzzling (using the most recent quarter): * Apple's quarterly revenue: $75.9b * Apple's quarterly profit: $18.4b * Apple's market cap: $538.7b * Apple's P/E ratio: 10.24 * Google's quarterly revenue: $21.3b * Google's quarterly profit: $6.8b * Google's market cap: 517.6b (pre-earnings) * Google's P/E ratio: 35.37 (pre-earnings) * F…

Apple will always have a lower P/E because the costs associated with building and selling physical products is higher. Facebook's financials are ~1/3 Google's and so is its P/E. It's a much younger company and seems possible that's it's revenue and profit could approach Google's. I don't see anything unbelievable or even particularly unusual.

> I don't see anything unbelievable or even particularly unusual.

Let's go back in time to a point when Apple's #'s roughly matched Googles.

https://www.apple.com/pr/library/2011/10/18Apple-Reports-Fou...

$28.27b revenue, $6.62 profit.

In 2011, Apple's P/E ratio hovered around 14, with a stock price that fluctuated around $46-$56 throughout the year:

http://financials.morningstar.com/valuation/price-ratio.html... http://www.nasdaq.com/symbol/aapl/historical

A P/E ratio of 14, and the company basically tripled their numbers in ~4 years. Does Google's P/E of 35.7 suggests we can look forward to a rough 10x increase in Google's numbers over the next 4 years?

Re: Alphabet Becomes the Most Valuable Public Company in the World

#156

Post by samstave »

lazaroclapp wrote: post #130
mrb wrote: post #108

Earlier quoted context omitted.

Which pretty much shows that the market value of a company is not based on what they sell today, but on the expectation of what they will sell tomorrow. Does Apple do research in biotech (Alphabet's Calico)? Are they developing drones delivering wireless internet to the world (Google's Skybender)? Do they have an investment arm (Google Ventures)? Did they start an ISP (Google Fiber)? People see Alphabet's increasing…

Apple's brand trades a lot on having extremely well finished products with very polished experiences. If they started experimenting left and right like Google does, they would lose that brand image, which is arguably their most valuable asset (even above and beyond the technology itself). If Google releases Glass and it flops, it hardly affects their image ('well, yes, it's cool technology, that's what Google does, b…

>Apple's brand trades a lot on having extremely well finished products with very polished experiences

I don't fully agree with this. Did you have the first version of the iPhone? No copy and paste? WTF.

Antenna signal dropping because "you're holding it wrong!"? WTF.

The only thing you can hold to the apple brand without any criticism is the industrial design of the packaging and look of their products has been consistent and un-matched.

There are plenty of UX issues that have arisen that take away from the polished experience.

Sure I like their products, but im not deluded to think that they are beyond reproach.

Re: Alphabet Becomes the Most Valuable Public Company in the World

#157

Post by dangrossman »

metaphorm wrote: post #118
dynofuz wrote: post #99

Earlier quoted context omitted.

Previously google used to organically list products in their "froogle" search. now all product listings are ads. Therefore it's not surfacing content from the entire web which almost always has products for cheaper prices.

are there no organic listings at all? or is it just that there are now way more paid listings so the first page is entirely paid placements? thats a pretty big difference. I recall that when froogle/google-shopping first launched they were just filling in content from search results because they didn't have very much direct engagement by vendors. maybe that's changed now so the search results were just scaled back be…

There are no organic listings at all. The only way into Shopping results is via AdWords' Product Listing Ads.

http://googlecommerce.blogspot.com/2012/05/building-better-s...

Re: Alphabet Becomes the Most Valuable Public Company in the World

#158

Post by jad »

percentcer wrote: post #145

It's interesting to that it took this long, just considering the utility of each company. If Apple disappeared tomorrow I'd be moderately inconvenienced, I'd have to pick up an Android handset instead of my iPhone and maybe set up some new podcast feeds. If Google disappeared the world would screech to a halt.

How's that? To search the web, I'd go to DuckDuckGo or Bing or whatever. Other companies also provide web mail, maps, office document solutions, etc. Google's definitely better at those things, but using a worse version of those products would not cause the world to "screech to a halt."

Probably the most disruptive thing if Apple vanished would actually be every tech company suddenly needing to figure out how to use Windows or desktop Linux.

Re: Alphabet Becomes the Most Valuable Public Company in the World

#159

Post by sangnoir »

draw_down wrote: post #107
lern_too_spel wrote: post #43

Earlier quoted context omitted.

Right, it gets them into more iTunes Ping situations.

They certainly have failures, that's one of them. But nobody was sad when it got killed, you know? Nobody misses iTunes Ping or iAds or MobileMe.

> But nobody was sad when it got killed, you know

Oh my, isn't that damning with faint praise? It's an indictment against Apple: Ping was so bad no one missed it.

Re: Alphabet Becomes the Most Valuable Public Company in the World

#160

Post by eric_h »

coldcode wrote: post #120
pinaceae wrote: post #100

Earlier quoted context omitted.

unlike Google, where practically 100% comes from one single product, which is ads. all "other bets" are actually losing money, per their data.

People love Apple's products (for the most part). People hate ads (pretty much everyone). So this makes no sense to me at all that Google is worth more than Apple. If you imagine the future, no one really knows what each will do with all the stuff they are building, so saying Google is worth more than Apple in the future seems silly.

> People hate ads (pretty much everyone).

And yet the percentage of people who watch the Super Bowl explicitly to see the ads is a non-trivial percentage of the viewing population (obviously anecdata, but I know many people who throw super bowl parties for groups who have no interest in the football, and just want to have a party while watching the moderately amusing, big-budget ads with breaks for football in between).

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