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Apple Becomes First Company to Hit $3T Market Value

20 points by 0xedb 5y ago

smoldesu 5y ago
> To Mr. Lazonick, a $3 trillion valuation is the result of a mix of factors. “It’s impossible to know how much of that is speculation, how much is manipulation and how much is innovation,” he said. I like quotes like this. Apple, for all their endless praise, is still a black box. We quite literally have no idea what they're worth, because they won't tell us. It only begs the question why, which, well... > “Apple could have gone and used that money to do all sorts of things. Instead, they’re using it to boost their stock price,” said William Lazonick
- mandeepj 5y ago
  > “Apple could have gone and used that money to do all sorts of things. Instead, they’re using it to boost their stock price,” said William Lazonick I don't think they are using that money to "only" boost their stock
- olliej 5y ago
  I mean Apple clearly makes a bunch of purchases, and uses its cash to doing things like buying supply capacity, and ensuring it has cash to weather storms. But then there's excess cash - they produce dividends and do stock buybacks to return cash to shareholders. As to your claim: We know exactly how much they're worth. Those quarterly results they issue are required to be accurate, and tell you exactly how many assets they have and exactly how much debt they have. The problem is at this point the value of shares on the stock market is detached from the underlying asset/debt ratio, and is instead based on traders beliefs about how other traders will behave. This is most apparent on for stock in companies that don't return cash, so the shares themselves don't produce a return until they're sold. OTOH I just have standard 401k style investment accounts so what do I know? :D
matheweis 5y ago
It reached $1T market cap less than two years ago… I wonder how much of this is due to the value of the dollar decreasing rather than the value of Apple increasing?
- awat 5y ago
  That was my first thought as well. While I don’t know their financials intimately from the outside I don’t know what they have done in comparison to Apple of yesteryear to triple the market cap. Feels ominous for the dollar.
- olliej 5y ago
  The value of USD vs other currencies. Noting of course the other currency values also change. Comparing August 2018 and today. USD vs the pound: 1:0.78 -> 1:0.74 = down 5% USD vs Yuan: 1:6.86 -> 1:6.36 = down 7% USD vs Euro: 1:0.86 -> 1:0.89 = up 3% USD vs CAD: 1:1.31 -> 1:1.28 = down 2.5% For inflation all these countries are targeting 2% annual inflation, so around 6-7% total inflation. So the most pessimistic view would seem to be USD vs Yuan and 7% from inflation, so maybe 14% comes from changes in "value"? Anyway, that's "only" ~$400 million :D

20 points by 0xedb 5y ago

> To Mr. Lazonick, a $3 trillion valuation is the result of a mix of factors. “It’s impossible to know how much of that is speculation, how much is manipulation and how much is innovation,” he said. I like quotes like this. Apple, for all their endless praise, is still a black box. We quite literally have no idea what they're worth, because they won't tell us. It only begs the question why, which, well... > “Apple could have gone and used that money to do all sorts of things. Instead, they’re using it to boost their stock price,” said William Lazonick

mandeepj 5y ago
> “Apple could have gone and used that money to do all sorts of things. Instead, they’re using it to boost their stock price,” said William Lazonick I don't think they are using that money to "only" boost their stock
olliej 5y ago
I mean Apple clearly makes a bunch of purchases, and uses its cash to doing things like buying supply capacity, and ensuring it has cash to weather storms. But then there's excess cash - they produce dividends and do stock buybacks to return cash to shareholders. As to your claim: We know exactly how much they're worth. Those quarterly results they issue are required to be accurate, and tell you exactly how many assets they have and exactly how much debt they have. The problem is at this point the value of shares on the stock market is detached from the underlying asset/debt ratio, and is instead based on traders beliefs about how other traders will behave. This is most apparent on for stock in companies that don't return cash, so the shares themselves don't produce a return until they're sold. OTOH I just have standard 401k style investment accounts so what do I know? :D

matheweis 5y ago

It reached $1T market cap less than two years ago… I wonder how much of this is due to the value of the dollar decreasing rather than the value of Apple increasing?

awat 5y ago
That was my first thought as well. While I don’t know their financials intimately from the outside I don’t know what they have done in comparison to Apple of yesteryear to triple the market cap. Feels ominous for the dollar.
olliej 5y ago
The value of USD vs other currencies. Noting of course the other currency values also change. Comparing August 2018 and today. USD vs the pound: 1:0.78 -> 1:0.74 = down 5% USD vs Yuan: 1:6.86 -> 1:6.36 = down 7% USD vs Euro: 1:0.86 -> 1:0.89 = up 3% USD vs CAD: 1:1.31 -> 1:1.28 = down 2.5% For inflation all these countries are targeting 2% annual inflation, so around 6-7% total inflation. So the most pessimistic view would seem to be USD vs Yuan and 7% from inflation, so maybe 14% comes from changes in "value"? Anyway, that's "only" ~$400 million :D