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> I don’t see anything in the future that can make Apple’s revenues grow at an above market rate. I think this comment illustrates why Apple's ratio is so low:
by snowwrestler 8y ago
> I don’t see anything in the future that can make Apple’s revenues grow at an above market rate.
I think this comment illustrates why Apple's ratio is so low: because Apple's future growth depends on new products, and new product development is opaque.
Conversely, businesses like Azure and AWS (and Google Cloud presumably) are already well-understood and the growth story there is just straight scaling.
- skgoa 8y agoNot just new products, but creating entirely new product categories. Just having well-selling products (lie Apple tv, Apple Watch etc.) isn't enough to move the needle compared to the money faucet that is the iPhone. Apple is still growing nicely and the stock is priced like a mature, but still very healthy company, but it's going to be very difficult for Apple to achieve another "hit it out of the atmosphere" homerun that is necessary to outperform a 17 P/E ratio when you have a trillion dollar market cap already.
- scarface74 8y agoNow I've changed my mind. Apple can continually grow without releasing new products - the same way that the others grow. They keep emphasizing the growth of thier services businesses. I don't see revenue growth growing by leaps and bounds but as long as they can throw off cash, they can prop the value up via dividends and stock buy backs.