Apple's Market Share Now Worth $$ Half Trillion

[amirm]

Am I missing something or is the value simply calculated by the value of a share at market close multiplied by the number of shares.

That's right. They have 932.37M shares outstanding. So if you multiply that by $542 share price you get $505B or so.

They have $100B in cash so the rest of the company is valued at $400B.

[Steve Williams]

That's right. They have 932.37M shares outstanding. So if you multiply that by $542 share price you get $505B or so.

They have $100B in cash so the rest of the company is valued at $400B.

I was responding to Frantz' post so you took my reply out of context. Frantz was trying to suggest market value is miscalculated. I was just doing the math

[FrantzM]

I do understand how the valuation of a company is calculated. I simply find the value of the shares themselves extremly unrealistic ... My education on the value of shares came sometimes around 1997 ..Ascend Communications was (one of) the darling of Wall Stre.. They were the leaders in making high density 33.6 Kbit/s modem for ISP... (The famed TNT) AOL announced they were going to add 15,000,000 more customers or some crazy numbers... The Contract was awarded to Ascend .. the value of Ascend shot up threefold upon announcement of the award of the contract ... The only problem was that if Ascend were to produce those 15,000,000 (don't remember the exact number) modems in a year, virtually all manufacturer of modems would have had to be working for Ascend to the exclusion of all other companies ... an impossible scenario ...Value went down rather quickly and Ascend was later acquired by Lucent which was later acquired by Alcatel .... All this to say that this valuation supposes a lot of things that are not yet clear .. That Apple in this game of software will retain its technical leadership (not a given .. Android is moving fast) .. That the market will never be saturated ... (approaching saturation in market such as the USA and even some underdeveloped countries) ...etc...

Then again, Wall Street lives in its own parallel universe which only coincide with ours when they are about to blow the planet and need to be bailed out ...

[Steve Williams]

Half trillion sounds so much more than 500 billion

[Orb]

Frantz,
you may be right in your feeling that it is unrealistic, but in terms of stock market it is pretty reasonable as their P/E ratio is under 15 and this is not bad; the higher the number the more "overheated" a stock share is.
So in market terms it is a pretty good stock.

My only concern is that without Steve Jobs it will lose direction in another 3-5 years from now; I remember the days when Apple went through a very bad patch many years ago.
Cheers
Orb

[Soundproof]

What's unrealistic about it?
The OS platform for computers and mobile devices is becoming ubiquitous and is the preferred platform for users of digital content, in both professional and private contexts, whether you are just enjoying it, working with it, need to share it, sell it.
The app-revolution has opened up a large new economy for developers, who are improving upon the delivery of the platform much faster than a company's own R&D could, further enhancing the worth of the products.
I've registered that every product I use that can be enhanced by integration with app's, or other integration with Apple computers, has released an app or integration solution - from kitchen appliances to my car manufacturer.

All challengers have failed, and Apple has invaded field after field, dropping "Computer" from its name (2007) as a signal of its intent, and utilizing the strength of its platform and its control over software/hardware integration to expand exponentially.

That share is going to rise a lot more, for the very simple reason that Apple has a very small portion of the total number of devices used, and therefore ample room for growth. They're selling ten times as many tablets as Samsung, for a while they couldn't make them fast enough.

And the fact that people know they become part of the Apple experience at a premium certainly helps the share price.

[Phelonious Ponk]

As far as thes kinds of numbers go, this is one of the more realistic big ones I recall. Many of them have been based on short-term market activity, or things much less substantial. This is based on long-term strategic activity that has simply paid off. The lesson here, for every other company in the world, is put the customer experience first. Worry about earnings later.

It will be learned by few.

Tim

[Orb]

Soundproof no disagreement but I feel a balance is required.
I remember in the past the very same sentiment for Sony, Nokia, Cisco, IBM, Intel, Microsoft, HP, Google (who were starting to look in trouble until they did a business model shift to include Android) , etc.
The problem is sustaining market share and growth once one becomes a behemoth (meant in a good way) of a business.
That said I am in the camp thinking its mkt cap is pretty good and Apple is a strong/very good company, but I am under no illusions the challenges facing Apple in the future from competitors and maintaining a good business and product model.

Cheers
Orb

[JackD201]

In terms of online retailing, what is Apple's rank? If I were to buy Apple stock today, it's the store and not so much the devices I'd be looking at for growth.

[Orb]

In terms of online retailing, what is Apple's rank? If I were to buy Apple stock today, it's the store and not so much the devices I'd be looking at for growth.

It would be interesting to see the breakdown between the different Apple revenue streams.
Just to clarify, personally I think growth requires a good business model and also products or services ; those other companies I mentioned when sentiment was at its height for them had both (excellent business model and also excellent product-marketing model) and then lost either the business model aspect or future product-services strategy.

Cheers
Orb