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Appple (AAPL) has never been worth more than rival Microsoft (MSFT). Although the brand equity in Apple is at an all-time high and it can't make its newer products fast enough, Microsoft's continuing bankroll every quarter from software licensing has trumped just about every other computer company (hardware and software) for years. Microsoft's consumer electronics products (except for maybe the Xbox 360) have never had the cache or consumer love factor as Apple's products. And, it finally happened: Apple's market cap bypassed Microsoft's this week.
Apple: $222 billion. Microsoft: $219 billion. That is, as of Wednesday. While Apple's iPad is still being spoke of as a computer interface paradigm shift by many (even without multitasking ability), and with the iPhone 4G about to be announced in under two weeks, the company's power has never been higher. Google (GOOG) is nipping at Apple's heels in the mobile space -- and it will do more than nip this year -- but Apple still has the cult power among consumers that no other company has.
Apple's computer sales are still going gangbusters, but it now receives twice as much revenue from its consumer electronics products. With relatively no abatement in site, the company's strategic shift from iPod to iPhone/iPad worked out incredible well and kept the gravy train rolling from the 2007 to 2010 time frame. Being one of the top-five companies by market cap in the U.S. is no small matter, and Apple is now there.
Apple's shares sit just over $255 right now and are headed higher come June when the mecca of Apple events -- the Worldwide Developer's Conference -- occurs. Could we see $300 with the introduction of the newest iPhone and perhaps a reinvigorated Apple TV? These products will hit back at Google's Google TV product along with Amazon.com's Amazon On-Demand television service that's already being integrated into Blu-ray disc players and flat-panel television sets. Apple has a lot of pressure to maintain its market-leading performance. Let's see if it can measure up.
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Reader Comments (Page 1 of 1)
5-28-2010 @ 5:48PM
thedude said...
WOW ! You guys are late to the party. This was news yesterday. Your article ignores the facts and exploits the fantasy. C'mon you can tell us, You're an Apple fan aren't you ?
General consensus is that with a P/E now over 21 Apple is seriously over valued. Microsoft P/E is below 14 so they are seriously under valued.
As long as Apple continues to create false value with over hyped products there is no end in sight. Truth be told however MSFT has far greater revenue and earnings. That's the facts.
Apple is a bubble waiting to burst and with their now playing in the stratosphere of market cap means that they will face more scrutiny from DOJ. For years Apple has gotten away with things that bigger companies get sued for. Those days may now be over.
5-29-2010 @ 11:28AM
Peter Weisz said...
If you're going to call yourself a stock market blog, at the least hire a copy editor to remove glaring spelling and grammatical errors (it's "cachet," not "cache," and "they're," not "their," for example). Your readers expect professionalism and credibility. That begins with proper English usage. If English is not your first language, then you should consider using an editor to give your copy a professional appearance. No one will take your opinions seriously without it.