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Apple Passes $300B Market Cap, 2nd In the World

Soulskill posted more than 3 years ago | from the let's-call-it-the-ibubble dept.

The Almighty Buck 485

An anonymous reader writes "In May, Apple surpassed Microsoft in market capitalization to become the second largest company (by that measure) in the world. Today, with its shares riding high, Apple passed $300 billion in market cap, entering a club of two along with the still-gigantic ExxonMobile. And investors' targets could bring Apple beyond where Exxon is now (though Exxon continues to soar as well). Perhaps Wall Street is catching on that, despite the discontinuation of their underused Xserve, Apple is in fact becoming one of the key tech providers to enterprise, a position that even a year ago seemed laughable. If you consider the iPad to be a PC (which enterprise increasingly is), then suddenly you realize that Apple is expected to climb to 12% market share in 2011. Plus, of course, they have those little things called iPods, and iTunes..."

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485 comments

yeah they're #1 (-1)

Anonymous Coward | more than 3 years ago | (#34751052)

cause they get so much support from FAGS and NIGGERS!!!!

Re:yeah they're #1 (-1)

Anonymous Coward | more than 3 years ago | (#34751084)

Never underestimate people stupidity.

Re:yeah they're #1 (-1)

Anonymous Coward | more than 3 years ago | (#34751102)

Are you GAY?

Are you a NIGGER?

Are you a GAY NIGGER?

If you answered "Yes" to all of the above questions, then the GNAA might be exactly what you've been looking for!

Re:yeah they're #1 (0)

Anonymous Coward | more than 3 years ago | (#34751240)

Like your post, for example.

300 billion reason to... (0)

baresi (950718) | more than 3 years ago | (#34751066)

...something something

Bubbles and things (0, Flamebait)

Dunbal (464142) | more than 3 years ago | (#34751072)

The bigger they are, the harder they fall...

Re:Bubbles and things (0)

whiteboy86 (1930018) | more than 3 years ago | (#34751334)

Like the US debt bubble? Just soared over 14 Trillion this week.. this default might be spectacular.

Sometimes, the bigger they are the bigger they get (3, Informative)

SuperKendall (25149) | more than 3 years ago | (#34751498)

P/E for Apple is actually not all that high. What you are overlooking is that Apple's valuation is so high because they are doing great in :

a) media sales
b) portable music player sales
c) smartphone sales
d) laptop sales
e) tablet sales

The thing is that Apple has a lot of products in very new and rapidly growing markets. If you think about pretty much any one of those categories and think about room for growth, you'll realize the apple share price is still pretty conservative.

Oh, and don't forget about the massiv Apple cash reserve which they've not even deployed to any great extent.

Once it was said: (4, Interesting)

DWMorse (1816016) | more than 3 years ago | (#34751080)

"We have to let go of the notion that for Apple to win, Microsoft has to lose." --Steve Jobs

All Apple had to do was stop trying to climb the fence to play in Microsofts yard, and apply some ingenuity to marketing and manufacturing. They've done well in these regards. You don't need to be an iFanboi to tip your hat here.

Apple will never replace Microsoft in the workplace, because they don't want to, there's not nearly as much money in it as replacing Microsoft in the home.

Re:Once it was said: (5, Insightful)

EdIII (1114411) | more than 3 years ago | (#34751264)

Apple will never replace Microsoft in the workplace, because they don't want to, there's not nearly as much money in it as replacing Microsoft in the home.

Yeah.. but from the summary:

Perhaps Wall Street is catching on that, despite the discontinuation of their underused Xserve, Apple is in fact becoming one of the key tech providers to enterprise, a position that even a year ago seemed laughable.

That made me actually read the article and it does not really indicate that Apple has anything earth shattering for enterprise at all. I have not really heard anything either, hence the quietly I guess. All it talks about is how enterprise is "figuring out" how to integrate the iPad. I hardly see that as providing key technology to enterprise which is exactly what the summary and article claims.

Re:Once it was said: (0)

Anonymous Coward | more than 3 years ago | (#34751282)

Apple will never replace Microsoft in the workplace, because they don't want to, there's not nearly as much money in it as replacing Microsoft in the home.

I'm an Android fanboy, but TBH I'd really rather see Apple in the workplace than Microsoft. But of course it isn't gonna happen, except for the high-ups in management getting their trendy iPads and iPhones and other such iStuff.

Re:Once it was said: (2)

Kjella (173770) | more than 3 years ago | (#34751290)

Apple will never replace Microsoft in the workplace, because they don't want to, there's not nearly as much money in it as replacing Microsoft in the home.

Except that they're not, not really. At least on browser stats Windows is still in the 90%+ range. The iPod wasn't aimed at anything MS had. The iPhone wasn't aimed at anything MS had. Perhaps the iPad, but even that doesn't replace the PC, it makes for a good viewing board but most people will need something with a keyboard. If Apple really wanted to replace Microsoft they'd have to change their Mac lineup considerably, drop prices and go for volume. It doesn't help to compare like for like when you can get laptops, mini-pcs and towers that cost less than half of Apple's cheapest offering. The "halo" effect of people getting an iPod or iPhone or iPad won't be enough to sell Macs on their own, they'd have to get more aggressive than that. I don't think they will, they'd rather surround Microsoft than replace them. But if Mircosoft gets enough chinks in the armor, maybe we can see the PC vs Mac War 2.0.

Without dividends... (5, Insightful)

_merlin (160982) | more than 3 years ago | (#34751088)

Buying stock in a company that doesn't pay dividends is just gambling - you're buying in the hope that you can find a chump who'll pay more to buy it off you at some point in the future. You can only make money by selling the stock. Apple isn't unique in this regard: most major tech companies and oil drilling companies don't pay dividends. But to me it just looks like a house of cards. You're just gambling on investor confidence in a company.

Re:Without dividends... (1, Funny)

Anonymous Coward | more than 3 years ago | (#34751120)

True, but Apple has nowhere to go but up. Apple is in a position of being absolutely unable to fail. They reach market saturation with one product line, they create another market. One can see this with the MP3 player market (complete ownership), smartphone market (complete ownership with Android and WP7 fighting for the left over scraps), and now the tablet market. There are still a lot of untapped markets, from home servers, to watches and jewelery, to car audio that Apple can make one product and immediately take the lion's share of the market.

Expect Apple to hit the trillion mark soon. With today's Apple, you don't need dividends; you are pretty much assured of an increasing value for the foreseeable future.

Re:Without dividends... (4, Informative)

Anonymous Coward | more than 3 years ago | (#34751184)

smartphone market (complete ownership with Android and WP7 fighting for the left over scraps)

lololololololololol [wikimedia.org]

Re:Without dividends... (4, Insightful)

Dr. Evil (3501) | more than 3 years ago | (#34751206)

Or... Steve will get sick, leave the helm and the stock will tank.

Re:Without dividends... (1)

damnfuct (861910) | more than 3 years ago | (#34751404)

Yeah, there is a ceiling up there somewhere, so "nowhere to go but up" is not quite certain. They are perched on their pedestal through their reputation of products and if they did anything to give themselves a bad enough name in the eyes of their users, then their position could easily be jeopardised.

Re:Without dividends... (1)

mad flyer (589291) | more than 3 years ago | (#34751460)

And when you see how slimmer he gets by the day, it's not looking good.

Bought shares 10 years ago, dumped them end of december. Already made a fucktons of money on this, no point in trying to get 1 or 2 more dollars while risking a huge fall...

Re:Without dividends... (1, Interesting)

0123456 (636235) | more than 3 years ago | (#34751250)

True, but Apple has nowhere to go but up. Apple is in a position of being absolutely unable to fail.

That's some mighty fine Koolaid you're drinking there.

It's interesting: last week I was looking through an old computer magazine from 1983 because someone on Slashdot asked about 8-bit computer prices and I had the magazine lying around in the basement. After that I noticed there was a review of the new Apple III, which pretty much said that it sucked, but the conclusion was along the lines of 'good or bad, people will buy it because it's from Apple'.

Clearly they were considered 'unable to fail' back then too, yet they went through some seriously rocky periods between then and now. From what I've found out, pretty much all the things they complained about with the Apple III were The Glorious Jobs' design choices which looked good to him but didn't work in the real world.

Re:Without dividends... (1)

the_humeister (922869) | more than 3 years ago | (#34751288)

I think your sarcasm meter is busted.

From the GP:

There are still a lot of untapped markets, from home servers, to watches and jewelery, to car audio that Apple can make one product and immediately take the lion's share of the market.

Watches? Jewelry? Clearly he's joking.

Re:Without dividends... (1)

damnfuct (861910) | more than 3 years ago | (#34751412)

One hopes the writer is joking, but it depends how strong the kool-aid is mixed in their case

Re:Without dividends... (2, Insightful)

bloodhawk (813939) | more than 3 years ago | (#34751276)

FYI, Android has already surpassed the iphones market share and windows phone 7 success or failure remains to be seen. Either way Iphone is currently on the decline. At it's current price Apple has a lot of ways it could go and many of them are in a downward direction.

Re:Without dividends... (0, Informative)

Anonymous Coward | more than 3 years ago | (#34751438)

FYI, Android has already surpassed the iphones market share

No It hasn't

http://blog.nielsen.com/nielsenwire/online_mobile/apple-leads-smartphone-race-while-android-attracts-most-recent-customers/

Re:Without dividends... (0)

Anonymous Coward | more than 3 years ago | (#34751456)

Yeah your right, I guess the rest of the world doesn't exist and smartphones are only sold in the US.

Re:Without dividends... (1)

Anonymous Coward | more than 3 years ago | (#34751502)

http://www.gartner.com/it/page.jsp?id=1372013

Still more world wide too.

I hate to break it to you... (5, Insightful)

MattskEE (925706) | more than 3 years ago | (#34751302)

smartphone market (complete ownership with Android and WP7 fighting for the left over scraps)

At least in 2009 (I haven't looked up 2010)
The Blackberry phones outsold iPhones (revenue and units sold) [gigaom.com] and as usual, Nokia dwarfs them all (in market share) [gigaom.com] .

Granted Apple has done quite well in the MP3 player market, and with its excellent profit margin it is certainly an extremely successful company. But let's compare Apple (market cap $296 billion) to Exxon Mobil (market cap $377 billion).

Exxon Mobil's 2010 profits of $19 Billion on $285 Billion in revenue [cnn.com] completely dwarf Apple's 2010 profit of $6 billion on $36 billion in revenue [cnn.com] . Granted Apple has a higher profit margin than Exxon Mobil, but in 2009 [cnn.com] Exxon Mobil's profits were greater than Apple's revenue.

Both companies are certainly successful, but I suspect Apple's stock price has more to do with its image than its value.

Re:I hate to break it to you... (1)

Kjella (173770) | more than 3 years ago | (#34751600)

Stock prices are always based on expected future earnings, not the present. Currently Apple is priced to take dominion over the mobile space the same way Microsoft was over the PC, what Microsoft made in the early 90s on MS-DOS abd Windows 1-3 is dwarfed by the earnings they've made 1995-present. Don't forget that image is also the cornerstone of a self-fulfilling prophecy, if people believe Apple will dominate then all the customers and developers go for Apple and it comes true. They're certainly much more attached to reality than say the Facebook pricing, which I'd call insane for a throne of "the place to be" that's changed hands several times.

Re:Without dividends... (1)

c0lo (1497653) | more than 3 years ago | (#34751450)

True, but Apple has nowhere to go but up.

This is a piece of wisdow from the same pool as "Home/real estate prices never go down" about 2 years ago, eh?

Re:Without dividends... (2)

ravenspear (756059) | more than 3 years ago | (#34751124)

Well it's a bit more complex than that. Your post makes it sound like the company valuation is totally arbitrary, that's not actually the case. How the company is valued in the future will depend on whether it experiences growth, whether it's products continue to be successful in the marketplace, etc, as well as simply attitudes about it.

Apple has had huge growth over the last 10 years. So people that bought the stock a while ago were betting that the company would be more successful in the future than when they bought it. Apple is both much larger and more successful as a business today than it was 10 years ago. So the increased valuation is clearly based on something.

Re:Without dividends... (1)

Anonymous Coward | more than 3 years ago | (#34751256)

While what you say is true, there is more than a little bit of market emotion in there current share price. For instance even with there explosive growth over the last 10 years they are still behind Microsoft in everything from Sales and revenue to actual profit margin (and MS return a dividend). Apples current Market valuation doesn't actually make a lot of sense when you put the numbers into the calulator. So really at Apples current price there is more than a bit of gambling involved as it requires astronomical growth to be maintained to justify it.

Re:Without dividends... (2)

larry bagina (561269) | more than 3 years ago | (#34751266)

In 2008, Apple hit just under $200/share before dropping to $100/share at the end of the year. If you look at the actual numbers from 2007 to today, they've been consistently getting better and beating expectations. They had the growth, they had the products, attitude and attitude alone cut it in half. For almost a year, the same line was marched out: "It's a recession and people will cut back on Apple products." (Apple posts blowout quarter while everyone else hemorrhages cash and Dell uses intel kickbacks to fudge the numbers) "Well, they had a good quarter, but next quarter will suffer." Wash. Rinse. Repeat.

To a large degree, the fundamentals don't matter as much as the attitude and the hype. Look at the tulip bubble, the .com bubble, the real estate bubble(s), etc.

Re:Without dividends... (3, Insightful)

AuMatar (183847) | more than 3 years ago | (#34751358)

Actually, it is totally arbitrary. The market cap is the number of shares times share price. The share price is whatever you can get someone to buy it for. It theoretically moves based on company performance, but there's no rules requiring it to. And it moves on rumor as much as on information. Hell, you have people at CNBC, the home of the wall street cheerleaders association speculating if the market will move based on how new york teams do in the playoffs. Yeah, sounds like it's really based on performance.

If you buy a stock for anything other than its dividend, you're investing in the world's biggest ponzi scheme. You may be willing to pay a premium if you think the company can grow it's dividend, but the only thing worth investing for is the yield and it's ability to maintain that yield.

Re:Without dividends... (4, Insightful)

ravenspear (756059) | more than 3 years ago | (#34751384)

Actually, it is totally arbitrary.

When you are talking about the 2nd largest company in the world, no it isn't.

Sure there are some stocks that have a high price just based on hype and not much else (the tech bubble taught us that).

But you do not get to a $300B stock without real metrics showing real growth and success. Apple has that. No other stock in Apple's class is pure hype.

Re:Without dividends... (1)

AuMatar (183847) | more than 3 years ago | (#34751494)

Metrics and growth? Sure. Enough to account for it's current valuation? A P/E of over 20 on an established company, and no dividends? No, I don't think so. It's pure hype. Which doesn't mean there isn't room to make more money there still, but that doesn't mean it's actually worth what it's going for.

Re:Without dividends... (1)

the_humeister (922869) | more than 3 years ago | (#34751186)

Depends on the stock really. Would you consider a buying stock in a company like Berkshire Hathaway (which also doesn't pay a dividend) to be gambling? Personlly, I'd rather put my money in BRK-A rather that AAPL.

Re:Without dividends... (1)

AuMatar (183847) | more than 3 years ago | (#34751376)

I'd consider them both fairly risky. Both are cults of personality built around their CEO. When they die/step down (and Buffet is old) the stock will tank.

Re:Without dividends... (3, Insightful)

the_humeister (922869) | more than 3 years ago | (#34751424)

Except Apple is more exposed to the whims of fashion and personal choice. Berkshire Hathaway, on the other hand, is a huge conglomerate/holding company. They can survive the loss of the head guy. With Apple, I'm not so sure about that.

Re:Without dividends... (0)

Anonymous Coward | more than 3 years ago | (#34751190)

Hrmmm... I hope you actually mean drilling companies specifically... for instance, EnCana. Cuz the big boys pay dividends, and pay them well (for the most part).

Re:Without dividends... (1)

_merlin (160982) | more than 3 years ago | (#34751348)

Yes, I did mean drilling companies specifically. Energy and resource companies tend to pay dividends, but the companies that do actual drilling and resource exploration don't.

Re:Without dividends... (1)

PolygamousRanchKid (1290638) | more than 3 years ago | (#34751192)

. But to me it just looks like a house of cards. You're just gambling on investor confidence in a company.

I don't think folks have confidence in Apple. They have confidence in Steve Jobs, because like him or not, he has always delivered over the years.

Now, if he goes into a hospital for a pimple on his butt, or an ingrown toenail, that stock is going to tank really fast.

It would be nice if he could mentor a protege. Just so folks would know how things will continue when he's gone.

Re:Without dividends... (2)

ravenspear (756059) | more than 3 years ago | (#34751234)

It would be nice if he could mentor a protege. Just so folks would know how things will continue when he's gone.

That's been going on with Tim Cook for years. Tim is in a pretty good position to take over Apple once Steve retires at this point. He already did briefly while Steve was out for surgery.

Re:Without dividends... (0)

Anonymous Coward | more than 3 years ago | (#34751370)

Tim already runs the company. He's just not the front man.

Redundant troll is redundant (2, Insightful)

seanadams.com (463190) | more than 3 years ago | (#34751218)

Why does someone have to be a "chump" to pay more for it? If the company's earnings have grown 10x then the company ought to be worth about 10x. Those earnings... do you realize they belong to the shareholders even if they just accumulate in the company's bank account? Dividends are a "feel good" disbursement for companies that aren't supposed to grow. If you want to invest in dividend paying companies go for it. Or you could buy apple and any time your holding is worth more than your basis, just sell some. You'd have done quite nicely even with that conservative approach, and yet still enjoy the feel of 0% capital appreciation that you crave.

Re:Redundant troll is redundant (3, Interesting)

Anonymous Coward | more than 3 years ago | (#34751360)

> Why does someone have to be a "chump" to pay more for it?

Because they're not actually going to get any money outside of selling the stock to someone else (see also: "no dividends").

> Those earnings... do you realize they belong to the shareholders even if they just accumulate in the company's bank account?

Unless the company loses them, gets sued, goes bankrupt, spend it on a foolish merger with a company that has lots of debt, is involved in fraud, bad accounting, and lots of other risks I can't think of right now (see also: Enron & anyone who invested in all those bad mortgages but didn't get a bailout).

In short, money in your pocket is worth more to you than money in someone company's bank account.

> Dividends are a "feel good" disbursement for companies that aren't supposed to grow.

So why didn't my portfolio of properly diversified assets with *good* P/E ratios collapse when everything else did? You remind me of the guy saying that the Dow would hit 20k before the crash. This news proves on thing to anyone sane: Apple stock is massively over-valued. But it's going to stay that way, Wile-E-Coyote style, until the masses realize that, too.

> If you want to invest in dividend paying companies go for it.

You're right that dividends aren't the only or even the best measure of value, but they're still a good one. And there's no question to me that Apple is over-valued. This is the time when smart people get fearful (Warren Buffet: "when people get greedy, be fearful; when people get fearful, be greedy" ... we're in "fearful" territory with Apple's stock). But that's just me. Any holding I have in APPL is probably part of some mutual fund and I couldn't rightfully tell you how much, if any, I have of their stock.

Re:Redundant troll is redundant (1)

seanadams.com (463190) | more than 3 years ago | (#34751418)

Apple has been trading for a very long time at about 15x trailing earnings ex cash. Do you think that is high for a growing company?

If you wanted to argue that, say, AMZN is overvalued that is an easier case to make. But seriously I can not think of a single profitable, growing, stable company that is as _stingily_ valued as apple.

Instead of hand-waving, why don't you actually tell us which smarter investments you have actually made that have fared better since before the dip. Keep in mind Apple was one of very few companies that grew through the whole recession (unlike most blue chips they recovered quickly and just kept going).

Re:Redundant troll is redundant (0)

Anonymous Coward | more than 3 years ago | (#34751372)

That's assuming the company was already accurate valued at 1X based on, mostly or exclusively, earnings - which is a laughable proposition for a tech company.

'Growth' stocks tend to start priced on the *promise* of future earnings, continue that trend as long as possible - and then plateau (or tank) as earnings increase enough for investors to be skeptical about more explosive growth.

Re:Without dividends... (2)

ejtttje (673126) | more than 3 years ago | (#34751242)

To add on ravenspear's comment, remember that part of stock valuation is based on how much money they have in the bank. So Apple may not pay out a dividend, but instead reinvest their profits, and the stock price will rise to reflect that you have a share of these additional assets. It's almost as if you received a dividend and automatically reinvested it.

Re:Without dividends... (2)

aliquis (678370) | more than 3 years ago | (#34751408)

I'd like to look at it in three ways.

1) Personally I see the dividend as the reason to invest at all, and as such it needs to pay out more than a bank account or you're stupid (?) since it's much riskier. Now people can of course pay more for the stock compared to the current earnings of the company because they assume earnings will improve in the future and hence give a reason to pay out a higher dividend by then.

2) Then we have the companies with lots of resources, either cash or invested in say buildings. If you can get 2-3 $ for every dollar you spend then it should be a good deal? (Unless you think there is a reason for that and those 2-3 $ will soon disappear.)

3) In conflict with #1 goes whatever the company should pay out the dividend at all if you can't decide to put it to better use yourself anyway. That is, if the company can invest the money in itself and turn out more profit from that money than the bank account rate, should it give the money back? If it can generate more profit than the stock market at large? More profit than anyone else?

But I'm new to the game, so maybe I'm missing something.

But yes, buying stocks in a company which never pays out dividends seem weird because say Apple would be "worth" 300 billion in stock value, and have 200 billion in cash (or cash + facilities), what do you get for the next 100 billion? And when will you get something back? If they never pay out any dividends and things start going bad will they just use up the money, never pay anything back and you're see your share price fall?

Meanwhile I guess Apple and Steve keeps the money as a buffer in case things do go wrong and they need to survive / be able to re-invest in something else and save themselves. If they money has left the company that would be much harder.

I know Volvo (not cars, trucks and construction gear) had saved a lot of money where the idea was to spend them on buying up smaller companies if the business cycle turned down for a low price and then gain even more advantages when things turned brighter again. That seems reasonable smart?

However some huge investor bought into Volvo and had them pay out lots of money to the share holders and then he left the company. So that way he turned a fast profit for himself and everyone else and maybe it was the right thing to do, what do I know, maybe they had collected too much cash? But over time I assume it was bad since it left Volvo much more vulnerable to a turn down on the global economy and rather impossible / harder to buy other companies to come back stronger.

Oh well.

Re:Without dividends... (1)

bennomatic (691188) | more than 3 years ago | (#34751244)

That would be true if the great majority of investment dollars came from people who do not invest based on fundamentals, but that supposition is incorrect. I'm not saying that the folks on Wall Street (or their programs) know everything, nor that they are the best barometer for a company's market value, but they invest in order to make their clients (and themselves) money. If every investment banker ignored fundamentals and just made the gamble that they wouldn't be the last one holding the potato, then none of them would last but a short amount of time.

Yes, there are day traders and micro-trading systems which execute gazillions of transactions which do affect company market prices. However, the great majority of that activity is simply noise around the trends that are defined by major investors who do indeed base their decisions on actual, quantifiable data.

Let's put it this way: if you're a major investor with millions of shares of XYZ stock, you love the fluctuations caused by day traders. XYZ announces a new tablet device without a side-facing camera? The geek set goes crazy on /., the uninformed investors bug out sensing a crash, the price dips 2% and the major investor buys another 500,000 shares knowing that the blip will soon disappear. And sure enough, a bunch of day traders notice that the major investor just bought 500kshares and they jump in to buy 200 shares each, countering all the initial sellers, and the shares start to inch up again.

My scenario is almost as over-simplified as yours, but you get the picture.

Re:Without dividends... (2, Insightful)

Anonymous Coward | more than 3 years ago | (#34751286)

Buying stock in a company that doesn't pay dividends is just gambling - you're buying in the hope that you can find a chump who'll pay more to buy it off you at some point in the future. You can only make money by selling the stock. Apple isn't unique in this regard: most major tech companies and oil drilling companies don't pay dividends. But to me it just looks like a house of cards. You're just gambling on investor confidence in a company.

Why are these ignorant comments consistently modded +5 insightful? Did they stop teaching economics in High School?

http://en.wikipedia.org/wiki/Stock_valuation

Re:Without dividends... (1, Informative)

abigor (540274) | more than 3 years ago | (#34751488)

Why are these ignorant comments consistently modded +5 insightful?

Well, this is Slashdot. The people who actually know stuff fled this place long ago.

Re:Without dividends... (1)

Anonymous Coward | more than 3 years ago | (#34751312)

I used to be of the mindset that would argue with this, I'd say that the valuation is based on a future expectation of dividends, or the expectation the company would buy back shares...

But lately I've come to believe that this stock market stuff is all a sick game.

http://www.sec.gov/rules/sro/nyse/34-52154.pdf

This filing is from 2005 when they got rid of AON "fill or kill" orders because their volume at the time had risen to 20 million trades per day, with 12K being AON. Only individuals with long term strategies place AON/DNR orders for stocks... There's no reason for a computer to do so.

Is there really any legitimacy to revaluing businesses that many times a day? Of course not. Furthermore the whole endeavor is a way to print money for the rich. We have laws that send Martha Stewart to jail for her "unfair insider information." What about the unfairness of setting up a business around market timings so precise that the speed of light has an impact, and you'd better not buy real estate too many milli-lightseconds away! Or having enough money that paying a professional broker represents a small percentage of your total liquidity? The stock market has gone mad, but I don't think there's a way back.
   

Re:Without dividends... (1)

flyingfsck (986395) | more than 3 years ago | (#34751324)

Uhh, so you'd be better off owning Microsoft stock? They pay dividends...

Re:Without dividends... (1)

_merlin (160982) | more than 3 years ago | (#34751366)

I would say that buying Microsoft stock is an investment that you expect to make some return on in the form of dividends. Whether that's a sound investment is another thing entirely. It's not an absolute gamble as investing in Apple or Dell would be.

Re:Without dividends... (2)

boxwood (1742976) | more than 3 years ago | (#34751368)

ummm no.

It just means the company you're investing in has decided to re-invest their profits into expansion. If their expansion plans succeed and is profitable the company will grow in value. If they piss it all away then the company doesn't grow and the stock does not increase in value.

Its no more of a gamble than investing in a company that pays dividends. The company pay dividends could just as easily fuck things up as a company that is growing. If that happens the company doesn't make a profit and you don't get your dividends.

So when investing in a company that doesn't pay dividends you have to ask yourself "am I confident that this company will continue to grow?" When investing in a company that does pays dividends, you have to ask yourself "am I confident that this company will remain profitable?" Either way its only a gamble if you don't know anything about the company.

Re:Without dividends... (1)

Kjella (173770) | more than 3 years ago | (#34751394)

That makes about as much sense as saying someone investing in cash is gambling, you're putting it in the bank in the hope that you can find a chump who'll give you something more valuable for it at some point in the future. If you want dividends, sell a bit of your stock each year. I can assure you that the relation between stock price and dividends is 1:1, if you increase the dividends you lower the stock price and vice versa. Of course this means you'll be diluted, but that is natural since everyone else is reinvesting their "dividend" and you're not, not unlike how you can either take out your interest from the bank or leave it there for next year.

Re:Without dividends... (0)

Anonymous Coward | more than 3 years ago | (#34751496)

Yes, more or less. Except in the case of cash, there is an interest from the bank, and the implicit guarantee from the whole economy (to the extent it is subject to taxation and other forms of exploitation by the state).

In the case of Apple, you have the word of the turtleneck.

The choice is yours.

Re:Without dividends... (1)

Man On Pink Corner (1089867) | more than 3 years ago | (#34751422)

Buying stock in a company that does pay dividends is buying stock in a company that literally has more cash than they know what to do with.

This is not good, long-term, if the company is a major player in a fast-moving technology sector. It means they have no vision for the future and no insights on how to leverage their own assets, so they're just "giving the money back to the stockholders," to quote Michael Dell's advice to Apple.

You have only to look at Microsoft under Ballmer for a perfect example of this.

Re:Without dividends... (1)

icebike (68054) | more than 3 years ago | (#34751440)

Time to sell.
It's been a good ride.

Re:Without dividends... (2)

getNewNickName (980625) | more than 3 years ago | (#34751582)

Dividends are usually not guaranteed either (unless we're talking about preferreds), so I don't see why anyone who thinks the stock market is a "house of cards" would feel safer holding dividend paying stocks. By your logic aren't you still a chump for giving a lump sum of money away so that it can be slowly given back to you in small uncertain increments?

The iPod is going out, though. (1)

M3wThr33 (310489) | more than 3 years ago | (#34751100)

As the iPhone and iPad continue to succeed, Apple neglects the original iPod more and more. Especially anything with a hard drive. I miss the days of dedicated music players.

Re:The iPod is going out, though. (1)

DWMorse (1816016) | more than 3 years ago | (#34751128)

I wouldn't call it neglect, per say. I would say "Trying not to one-up our own devices." Why drive down sales of your more-expensive-to-own products?

Re:The iPod is going out, though. (2)

RyuuzakiTetsuya (195424) | more than 3 years ago | (#34751176)

I don't.

I used to juggle an iPod Nano(and before that, some sort of Sansa player), a cell phone and a DS.

The only thing i have to say is...

"Specialization is for insects." -- Heinlein.

Or maybe it's even more hype (3, Interesting)

the_humeister (922869) | more than 3 years ago | (#34751116)

Market capitalization is only one metric. There's also gross revenue (which Wal*mart wins) and net profit (which Exxon wins again). At current prices, AAPL still seems a bit overpriced compared to its peers.

Re:Or maybe it's even more hype (1)

mattack2 (1165421) | more than 3 years ago | (#34751246)

Like what? The P/E ratio is still relatively low. (21.75 from quote.yahoo.com just now.)

Re:Or maybe it's even more hype (1)

afidel (530433) | more than 3 years ago | (#34751292)

For a Blue Chip in a down economy anything over 15 is quite high.

Re:Or maybe it's even more hype (2)

the_humeister (922869) | more than 3 years ago | (#34751318)

21.75 is low? Try 13 for IBM or Microsoft, 11 for HP, etc. Now clearly they're not RedHat (100!), but still a bit overpriced. Remember back in late 1990s/early 2000s when the entire tech sector was in 20+ P/E territory? They were overvalued back then, and they all fell eventually.

Re:Or maybe it's even more hype (1)

bloodhawk (813939) | more than 3 years ago | (#34751380)

20+ is quite high and requires a very high growth rate in future to maintain it. Apple is overvalued for there current income/profit as the share price has a considerable amount of future growth already priced in, basically any minor wrong step could easily see 20-30% wiped off their shareprice in a very rapid timeframe (and a wrong step just has to be good instead of astronomical growth).

Re:Or maybe it's even more hype (4, Insightful)

hedwards (940851) | more than 3 years ago | (#34751506)

21.75 isn't low. The tech industry typically has unreasonably high valuations due to the tendency of the industry to capture the imagination of know nothing investors.

Right now, MSFT is trading at an 11.86 P/E ration and Google at a 24.21, but MSFT despite all the ill will I personally have against them, has done a better job over time maintaining its income and I don't expect that to change any time soon.

You'd have to be an idiot to think that APPL is genuinely worth about double what MSFT is.

If the future is now the iFuture (1, Informative)

tpstigers (1075021) | more than 3 years ago | (#34751132)

it is a bleak landscape of conformity and despair.

Re:If the future is now the iFuture (1)

bstag (933525) | more than 3 years ago | (#34751154)

it is a bleak landscape of conformity and despair.

Its amazing how much they became what they said they despised. http://www.youtube.com/watch?v=OYecfV3ubP8 [youtube.com] Sure looks like what apple wants to the world to be like today.

Re:If the future is now the iFuture (1)

ieatcookies (1490517) | more than 3 years ago | (#34751342)

On the contrary, appl is driving competition and innovation. Just check out any review on a cellphone and note the likely title: iPhone killer? The future is gonna be damned cool, I wish I could live longer to see more of it.

Re:If the future is now the iFuture (0)

Anonymous Coward | more than 3 years ago | (#34751560)

That’s only cause their products are so easy to kill, very fragile, underpowered and over priced. Personally I don't understand it its like saying a midget killer or gunnie pig killer.

Market cap? (5, Interesting)

DogDude (805747) | more than 3 years ago | (#34751152)

High market capitalization doesn't mean anything other than people are interested in owning a piece of this company. It doesn't mean that the company is successful, or even profitable. It's a common fallacy (some would argue, THE common fallacy) that stock price has anything to do with the underlying company's intrinsic worth.

It's the same problem that sacked the mortgage market. The system is set up so that the bits of a company, called stock (or the mortgage) are entirely unconnected to the supposed underlying item of value, which is the company itself (building, property). With the stock market, people don't expect company dividends (anymore), and, even more bizarre, the supposed owners of the company aren't liable for any company crimes. Market capitalization is as meaningful as Twitter trends are.

That being said, it's interesting from a purely social point of view.

Re:Market cap? (1)

monkyyy (1901940) | more than 3 years ago | (#34751236)

how is stocks any different from money, as in they are only worth as much as people think they are

Re:Market cap? (1)

HungryHobo (1314109) | more than 3 years ago | (#34751362)

assuming that a company has more assets than debts the stocks have a theoretical lower limit to their value?

Re:Market cap? (1)

bloodhawk (813939) | more than 3 years ago | (#34751410)

That is a massive assumption to make, especially in the financial climate of the last few years.

Re:Market cap? (0)

Anonymous Coward | more than 3 years ago | (#34751480)

I think you need to check the meaning of terms. The value of any company is at least assets minus liabilities.

http://www.wikinvest.com/stock/Apple_(AAPL)/Data/Total_Current_Assets
$41.68 billion

DICTIONARY

Current Assets are cash, cash equivalents or assets the company expects to sell, use-up, or convert to cash in the upcoming year.

Re:Market cap? (1)

bloodhawk (813939) | more than 3 years ago | (#34751516)

I think you need to go back to school and learn to read.

quote
"assuming that a company has more assets than debts "
my response
"That is a massive assumption to make, especially in the financial climate of the last few years."

Re:Market cap? (2, Insightful)

HungryHobo (1314109) | more than 3 years ago | (#34751294)

I've always been a bit puzzled by why the owners of a company are so utterly sheltered from damage cause by or crimes committed by that company.
It gets waved away with claims like "well of course then people might not want to invest in those companies" which while true would also be the point.
If to protect themselves people demanded reasonable proof that a company was behaving ethically and within the law before investing in it then we might see companies breaking the law less and behaving more ethically.

If I own an old building which collapses and hurts a bunch of people because I'm too greedy to invest money in repairs, I'm liable.
If I own a dog and it bites someone because I'm too greedy to invest in a fence or muzzle, I'm liable.
If I own a corp and it kills a load of people because in order to keep me an an investor because I'm too greedy to accept a 0.1% lower dividend rate it didn't put money into the safety systems.... I'm off scott free.

Re:Market cap? (1)

jjohnson (62583) | more than 3 years ago | (#34751466)

You're not off scott free. If you're a shareholder in a company that causes everyone in a small town to get cancer because they're dumping pollutants in the water supply, your investment will drop in value when the class action suit gets certified and the company is looking at billions of dollars in payouts. All the incentive you need is there to actually examine the company and dump your stock if you fear they're misbehaving.

There's no proof available a priori that the company officers will act ethically, and as far as catching them acting badly, that's what quarterly and annual filings are for. Enron was quite famously detected early on by several analysts who actually read their filings and realized that it there was a financial shell game going on; the problem was that the market as a whole didn't look. But those few analysts started the snowball that ended in Enron's bankruptcy.

The problem is 1) the size of the companies and 2) the massive amounts of money involved that tie up lawsuits for years. It's possible to get away with fraud and bad acts for years or even decades before you get caught and have to pay.

... and fanboys. (4, Funny)

mindstormpt (728974) | more than 3 years ago | (#34751156)

Especially fanboys.

Re:... and fanboys. (0)

Anonymous Coward | more than 3 years ago | (#34751468)

That's OK. For every "fanboy" (apparently anyone who uses a Mac) there are two people making kneejerk comments about Apple or Macs. As someone who bought in at $13 I'm inclined to think it's all about jealousy. :-)

Skewed list, and pointless! (0)

Anonymous Coward | more than 3 years ago | (#34751226)

Actually the list is skewed a bit, Berkshire Hathaway would be first as they trade in two categories, puts them combined over 400+ Billion, even more than exxon or apple. But in the end Exxon or Walmart have the real market power. Never rule out Buffett until hes not making Berk Hath's finance decisions!

iRape (1)

chromozone (847904) | more than 3 years ago | (#34751228)

"The moment came Wednesday when Apple, the maker of iPods, iPhones and iPads, shot past Microsoft, the computer software giant, to become the world’s most valuable technology company."

Now the politicians, regulators etc will be looking for their pound (or two) of flesh.
Being #2 isn't so bad really.

Re:iRape (1)

boxwood (1742976) | more than 3 years ago | (#34751432)

Only if they're doing something illegal.

Yes MS had to pay a bunch of lobbyists to get regulators off their backs, but that was because they were actually breaking the law. They were illegally using their monopoly in the OS market to squeeze out competitors in other markets. We bitch about how bad IE is but we're damned lucky that MS let it stagnate so long. Otherwise we'd all be forced to use the Microsoft Internet, which could only be viewed with MS software that was copyrighted and patented to prevent anyone from using it.

Apple can be bastards at times, but they aren't a monopoly in any market so they don't have anything to worry about from regulators, as long as they don't cook the books.

Steve v. clones (2)

antifoidulus (807088) | more than 3 years ago | (#34751304)

You have to wonder if Apple is going to allow Lion Server to be virtualized on non-Apple servers. This would go a long way to help Apple dig out of the hole they made for themselves in the enterprise world when they canceled the XServe without offering a *REAL* replacement(no Mac Pros and/or Mac Minis are not replacements!). Allowing Lion to be virtualized on non-Apple hardware would give Apple more of a presence in the datacenter without having to maintain a "bulletproof" server hardware engineering team and a large number of parts distribution center. However Steve hates the whole "mac clone" market so much that he seems to be willing to screw his customers over rather than let them run *JUST* the server OS on non-Apple hardware. I still don't know why he didn't opt to allow OS X server to run on "certified" oracle servers, it would have been a win-win for both companies. Apple would have been able to free up the resources previously devoted to the XServe without screwing over some of their most ardent supporters and Oracle would have gotten both sales AND a ton of free advertising for their server division since Apple is currently the media darling and everyone would be reporting on said relationship.....

Re:Steve v. clones (1)

RyuuzakiTetsuya (195424) | more than 3 years ago | (#34751330)

Other than selling hardware, I don't even know if there's any money to be made in enterprise datacenter iron. It looks expensive, but the costs to fulfill SLA support contracts must be hell.

Still though, I wouldn't say no to Xserves running newer Xeons running Lion Server.

Re:Steve v. clones (2)

antifoidulus (807088) | more than 3 years ago | (#34751392)

Well the cost structure from the company's perspective, is very different for personal computers vs. servers. Namely personal computers have very little after-sale cost, a little bit of labor for support and cost for replacement parts, which do not have to be fixed in a very short time frame. Servers however have significantly higher after sale costs because you need to make sure you have enough parts on hand and in the right locations at all times. Keeping a large number of rapidly deprecating parts around really isn't sustainable on the scale that Apple was selling XServes so I can see why Apple killed the XServe. Killing the XServe wasn't Apple's mistake, Apple's mistake was not offering anything equivalent in its stead. Again, had they partnered with Oracle(or HP or Dell, but considering that Apple competes with HP and Dell in a lot of areas, I doubt that would have worked out very well) and officially blessed running OS X server on Sunfire servers then we wouldn't have a problem. Sunfires are damn nice machines(and second only to XServes in aesthetic value :P) and you would have had 0 complaints from the Apple enterprise community.

In fact allowing a lot more flexibility in hardware and software would have been seen as a huge boon and probably would have resulted in a significant increase of OS X server, but again back to my original point, Steve is so obsessed about not repeating the mac clone experiment that he would rather see OS X server, and it's users who tended to be the most rabid pro-Apple people out there, suffer rather than just let the server OS run on officially blessed 3rd party hardware. Really, REALLY dumb move IMO and probably the first big mistake Steve has made since coming back to Apple.

Re:Steve v. clones (0)

Anonymous Coward | more than 3 years ago | (#34751436)

+1 we are still sick about the xserves death.

The mini is a joke, and the big-mac just isn't the form factor I want to work with.

MS owns a big bite of Apple (0)

flyingfsck (986395) | more than 3 years ago | (#34751314)

Note that MS owns a big slice of the Apple pie.

I used to think the iPad was a joke... (1)

Anonymous Coward | more than 3 years ago | (#34751326)

Who would want an oversized iPhone that has limited software support? Why would I want one if I can't use Entourage, Excel, Word, etc...

What I've come to find, is that my own company (subsidiary of Cox Enterprises) has created iPad apps for our general managers to track track and keep up with sales stats, trends, etc... and that most interestingly... one of our clients, Nissan Motor Acceptance Corp. has an iPad application for their field reps that allows them to do away with paper entirely while they walk/inspect the cars they intend to sell.

We are entering a world where web apps and custom "iSoftware" (has this been TM'd yet?) are now taking the place of generic software.

Anybody have a link to one of those "free iPad!!!!" websites? All of a sudden I have the urge to stretch my iPhone screen by 300%....

What is Apple's Next Product? (1)

BondGamer (724662) | more than 3 years ago | (#34751332)

Every 2-3 years Apple has been releasing a product into a brand new space now. People are currently focused on the iPad. But the question every investor wants answered is what comes next and how successful could it be? Apple is already over the iPad while other companies are still trying to copy it.

A better bet to short for 2014? (1, Interesting)

Hadlock (143607) | more than 3 years ago | (#34751338)

Apple has been sitting at (or around?) 4-5 billion in revenue for the better part of this last decade. They have great products, and a modest growth in sales each year, but as many have pointed out, most of the ipod/iphone sales are replacements, or selling to new (young) people just entering the market. Don't get me wrong, Apple sells fantasic products (I keep eyeing the iPad as a replacement to my dead-tree edition to the NYT), but IMO their sales will plateau soon unless the global market for Apple products expands dramatically during this global recession. Let the short term buyers drive up the price; the long game almost guarantees that after an initial run, the price will plummet back to 2009 prices. Apple is squarely in the consumer market, and I don't see them expanding in to the enterprise market in the near future (unless they release an enterprise-focused brand in the near future?). HP, Dell and the like aren't going anywhere. If you're looking for a quick buck, keep browsing biotech and Big Pharma. Technology is a mature market that's been mined out. The smart CEOs in the tech sector are going to learn from the Googles and Facebooks that one time IPOs and private investment are the right way to go. IPOs followed by split after split after split will disappear as a corporate strategy for viable companies.

Re:A better bet to short for 2014? (2)

SuperKendall (25149) | more than 3 years ago | (#34751540)

You are insane if you think Apple stock will see 2009 prices again. And that's solely factoring in the smartphone growth that is EXPECTED, not counting the bonanza Verizon will bring them...

There is no plateau in sight, except possibly for desktop sales. Laptop sales are exploding, iPad sales are exploding, smartphone sales are exploding. Apple has strong products in each of those areas, and they are obviously not sitting still.

And as for "modest growth" I'm sure lots of other companies would kill for year-over-year growth of 30-60%... depending on the quarter over the past few years.

Enterprise? (2, Insightful)

aslag (1884052) | more than 3 years ago | (#34751416)

If there's one thing Apple is not, it's enterprise. iPods, iPads, iPhones and even mac OS are all consumer-grade products designed with the aim to fuse gucci-like sex appeal with simple usability. Where does security, stability, and manageability fit into this? Selling style, luxury, and limited functionality (for the sake of ease of use) has always been Apple's niche and it's worlds away from enterprise-grade software and hardware.

Consider HP SANs or the Solaris operating system: these are highly-manageable, dependable, secure enterprise products. They make up infrastructure that must be relied-upon. The companies who make them provide expert support to ensure proper setup and continuous service. They are complex and well-engineered. These are not qualities of Apple products.

Of utmost importance for enterprise users is security. It seems that Apple often botches this. Consider just the security problems with iPhones that have been discovered in the last year. We learned that iPhone email security is farcical and that their on-disk encryption doesn't really work (c.f. http://marienfeldt.wordpress.com/2010/03/22/iphone-business-security-framework/ [wordpress.com] ). We also saw remote execution flaws (http://securitytracker.com/alerts/2010/Sep/1024413.html), and Apple's mishandling of iPhone PKI (http://cryptopath.wordpress.com/2010/01/).

And security isn't the only feature of enterprise hardware and software that is divested by Apple. Apple's software often lacks any remote management software, let alone robust tools for this. Dependability, too, is often not a feature of their products.

To claim that Apple's products can serve the enterprise customer seems ludicrous. I would hope that, over time, the features of well-engineered enterprise products find their way into consumer-level products; deploying Apple products in the enterprise seems to transplant the flaws, shortcomings, and hassle of consumer products into the enterprise. Who desires this?

Re:Enterprise? (0)

Anonymous Coward | more than 3 years ago | (#34751570)

Your post is idiotic. Do you know anything at all about OS X? It's a Unix, like Solaris. You are a total dummy.

Let the Microsoft fan boy squealing begin (0)

Anonymous Coward | more than 3 years ago | (#34751528)

A little late to the game but it still applies. Funny how quickly people have to downplay the accomplishment. Anyone that downplays this is by definition a Microsoft fan boy. I'm not a fan of either they both have their strengths and weaknesses. It's amazing that Apple which was never seen as a strong competitor can in a matter of a few years blow past Microsoft. Microsoft has gotten sedentary and lacks any real innovation so it was just a matter of time before Apple passed them. Microsoft may be on more computers but if they aren't careful even that can change. This should be a wake up call for Microsoft. I'm sorry but Windows 7 is still a pain in the ass compared to Snow Leopard. If all my software ran on Snow Leopard I'd drop Windows 7 like a hot potato and that's a fact. They need to go back to their roots with with Windows 8 and stop trying to be a pale knock off of the Mac OS. I still prefer XP over any of the current OS's which is a sad thing all these years later.

Dell... (1)

hotfireball (948064) | more than 3 years ago | (#34751530)

Whoa!... So, Michael Dell, eat your heart out.
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