Apple vs. Exxon
February 18, 2015 4:00pm by Barry Ritholtz
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“Market valuation” is merely the ranking of stocks in a market popularity contest. To understand the order in which the entrants are ranked, one need to look at performance metrics, things like free cash flow, margins, revenue growth … how effectively each entrant generates profits.
That said, the rankings shown are fair representations of the market’s assessment of each of these companies along those lines.
Apple’s worth 20x next years earnings, or $183/shr
that is $1.1 trillion
My call: after successful launch of Apple Watch in April, expect a 50 billion one time dividend or buy back, around July, after Cook get’s to confirm demand & margin mix of the watch
I’m glad your crystal ball tells you what Apple is going to earn next year. Mine’s pretty foggy.
Correction, Apple is worth 20x next year’s estimated earnings, which almost always turn out to be lower than actual earnings.
Apple builds nice products. Exxon destroys the planet.
An iPhone uses more electricity than a refrigerator, due to all the cloud operations necessary for it to work every time you, for example, check the weather.
Exxon is no more responsible for the mileage of your car than Apple is for your phone electric use.
I compare the chart in crude with the nasdaq 1999/2000 chart. Both showed a parabolic rise, collapse, and failed counter trend rally that ultimately failed. Given the length of the topping process for crude, I feel the bottoming and basing will too take years to occur. The back of the envelope target I get, from looking at the inverted flag pattern on the monthly crude chart points to $20 a barrel. XOM chart looks like a very long topping process. Right now the voters are saying AAPL is still worth buying while XOM is not.