News - Apple now worth more than Microsoft

[Scott B]

Let's have a recap on the story: This is the first time you would have to pay more to acquire all of Apple's available shares than Microsoft's. There may be interpretations of market cap that still put Microsoft ahead, but as a symbolic moment it's still significant.

Why is it significant? The article proposes the market is betting on the mobile Internet being the future and Apple is much better positioned in this market than Microsoft. This is why Apple's market cap is now in excess of Microsoft's despite Microsoft still posting higher earnings, and hence the P/E observation.

So the whole point is that the two companies are now mostly competing in different markets and this symbolic moment - unheralded by any press releases - indicates the relative directions those two markets are travelling in.

[mikerr]

Here's a better analysis:

http://royal.pingdom.com/2010/04/09/...5-until-today/

[TheAnimus]

So the whole point is that the two companies are now mostly competing in different markets and this symbolic moment - unheralded by any press releases - indicates the relative directions those two markets are travelling in.

No, it doesn't.

I'm not picking on you scott, this is a miss understanding a lot of the press have, sadly I expect the Beeb technology not to be able to talk to say steph who would probably have put em straight!

Market Cap = Shares outstanding * price per share.

What is symbolic is when you look at the change in price, this is a MUCH better benchmark of a stocks performance.

Market Cap is really nothing to go by, it is very useful for an investor type for telling you what the value of the market for the stock is.

It definitely does not indicate worth.

I should point out that I think its really interesting that the market for apple shares is larger now than the market for MSFT. This is quite something as its showing the way investment banking is leaning towards high volume consumer items as we all adopt must have culture.

[Kamakazie]

Let's have a recap on the story: This is the first time you would have to pay more to acquire all of Apple's available shares than Microsoft's. There may be interpretations of market cap that still put Microsoft ahead, but as a symbolic moment it's still significant.

Regardless of the stories principle, the headline "Apple now worth more than Microsoft" appears to be wrong and is aking to a tabloid newspaper, not a well informed technology website.

Hexus is not the only site reporting the news with the same sort of headline though.

What is the actual value of each company (were you wanting to buy each in it's entirety, not just all publicly available shares)?

[Scott B]

No, it doesn't.

I'm not picking on you scott, this is a miss understanding a lot of the press have, sadly I expect the Beeb technology not to be able to talk to say steph who would probably have put em straight!

Market Cap = Shares outstanding * price per share.

What is symbolic is when you look at the change in price, this is a MUCH better benchmark of a stocks performance.

Market Cap is really nothing to go by, it is very useful for an investor type for telling you what the value of the market for the stock is.

It definitely does not indicate worth.

I should point out that I think its really interesting that the market for apple shares is larger now than the market for MSFT. This is quite something as its showing the way investment banking is leaning towards high volume consumer items as we all adopt must have culture.

I don't feel picked on. Heathly, informed debate is what the HEXUS.community is all about.

I will point out, however, that this perspective was not just picked up by me, the beeb and Metro, but by the Economist, Telegraph, NYT, etc, and the symbolism of the moment is undiminished by any difference of opinion over how to best measure the overall worth of a company.

Furthermore, market cap changes as the share price does, so this is a measure of the relative change in the share prices of the two companies.

I hope we all agree that Apple's share price is on a much steeper upward trajectory than Microsoft's and that, given their respective strengths, that is indicative of at least greater speculative interest in the kind of market Apple is operating in. The rest is just semantics, but worth debating nonetheless.

[TheAnimus]

Furthermore, market cap changes as the share price does, so this is a measure of the relative change in the share prices of the two companies.

I hope we all agree that Apple's share price is on a much steeper upward trajectory than Microsoft's and that, given their respective strengths, that is indicative of at least greater speculative interest in the kind of market Apple is operating in. The rest is just semantics, but worth debating nonetheless.

If I wanted dodgy reporting i'd be reading only the metro not hexus I should also say that helping people visualise market data movements in real time has been quite lucrative for me, I had a very successful system which carries in excess of $2bn worth of risk on it, or about 1% of MSFT market cap

Market cap changes inline with share price from that simple forumula true.

But in the same way that a fall of say 10cents on a share worth 100$, is not as significant as a fall of 1cent on a 1$ share, you have to look at them in context.

What this does show, is that the public market for the shares is bigger. This is really quite something.

Market Cap really just shows you how big the market for trading the stock is, the bigger the better as far as investors go, you wouldn't want to own 10% of the company, its much better to have that same money, that same ROI as 0.001% of a company, that way if you want to sell you will have no effect on the price etc.

As such Market Cap is very useful for traders as that larger it is, it suggests that it will be easier to trade in, however you also have to include liquidity, obviously this isn't a problem if your looking to punt say $5m and the market cap is $10bn., but when they get to say $1m and $500m it can be. So most people look at a market cap and liquidity, based on the the number of shared traded recently.

The thing is, these figures aren't very intresting

What is, is the march of apple, the fact that despite a recession (apparently) they have improved, whilst a company more aligned on business, and what I would say are inheriently more a constinstantly required good haven't performed so well.

By this I mean Microsoft's stuff is just needed, you want some £18k per year office staffer, they only know MS office, its not worth training them on OO, so you run windows, you run office, you run sharepoint, you run winserver........

Apple are more of a Veblen good, but one that is amazingly mass market, as such you would expect them to struggle more.

Very odd indeed, and I think we might need a new classification of goods

[Scott B]

The thing is, these figures aren't very intresting

You appear to be in a minority my friend.

[TheAnimus]

You appear to be in a minority my friend.

I know that, if I wasn't there wouldn't be so much demand for me

But seriously, you see my point on Market Cap? Its in no way 'worth' of the company as a whole. It is just the worth of the public traded element.

And now that Mad Money Man has said Apple is a buy, I think I'm off to buy some MSFT. I know of two traders on a US Eq desk who have made impressive returns over the last 18 months just doing the opposite of what he says pretty much.

[Scott B]

I know that, if I wasn't there wouldn't be so much demand for me

But seriously, you see my point on Market Cap? Its in no way 'worth' of the company as a whole. It is just the worth of the public traded element.

And now that Mad Money Man has said Apple is a buy, I think I'm off to buy some MSFT. I know of two traders on a US Eq desk who have made impressive returns over the last 18 months just doing the opposite of what he says pretty much.

I do, and concede that specific point But given that EV or whatever is harder to come by, as is information about the non-public worth, market cap can at least provide a crude indication of the relative fortunes of the companies.

Regarding Jim Cramer - who I assume you're referring to - I couldn't agree more. Lowest common denominator ranting and investment advice seem odd bed-fellows to say the least. Jon Stewart had quite an entertaining pop at him after he had talked up the market before the 2008 crash. Unfortunately Comedy Central doesn't offer clips to non-US viewers and seems to have done a good job of keeping it off YouTube.

[Barrichello]

Regarding Jim Cramer - who I assume you're referring to

Have to love Jim Cramer is always good for a laugh when he gets heated, at least he is entertaining

For anyone not aware of who he is, this was his finest moment..... http://www.youtube.com/watch?v=I1eSlYtXiro lol

[Jay]

So M$ makes more profit, has a better turnover but is worth less? Brand power for the win! I remember when Apple was a joke... still is in a way. They make stuff for a high price. Its just BSD + over priced hardware for christ's sake. Could I carry on without my iPhone? no.... my blackberry is turd when put next to the iPhone, but only after jailbreaking it.

In the last few years M$ has got its act together Windows 7 is really pretty good and 2008 R2 is fantastic as is SQL 2008. I really hate to say this but Linux has stalled and Microsoft has made a massive jump, its actually worth the money for Microsoft products these days. Apple have just made stuff that is thin and white! the Price is stupid but people buy it, I use Free BSD on my home router but thats about it.