“The Google versus Apple debate has never been more vibrant. Ever since both companies rose to dominance in 2007, we’ve seen countless investors, journalists and analysts take opposing sides on virtually every aspect of this war between the tech titans,” Andy Zaky writes for Fortune.
“But is there really a debate when it comes to investing? The short answer: Not based on the numbers there isn’t,” Zaky writes. “The financials, fundamentals, and valuation continue to fall squarely in Apple’s corner. Any level-headed investor would buy Apple over Google today, especially in light of Google’s recent unjustified parabolic rally to $770 a share just before it reported an epic miss on earnings.”
Zaky writes, “In 2009, Apple earned more than Google in net income for the first time in its history. Three years later, Apple reported three times as much in net income as Google. In 2013, Apple is expected to quadruple Google’s net income and report twice Google’s growth rate… If Apple merely just remained at this current price-level, it would have its entire market cap in cash over the next four years. If it collapsed as some believe that it will, the company would simply be able to take itself private. That’s why Apple continues to push higher, why it will continue to push higher and why it is clearly a much better investment opportunity than Google going into the next three years.”
Much more in the full article here.
[Thanks to MacDailyNews Reader “kevin p.” for the heads up.]
GOOG’s “parabolic rise” was due to their big three selling millions of shares a month before the “epic miss on earnings.”
Now the start their “parabolic” descent?
Excellent information from one of the best independent analysts around!
The market is always right. No matter how ‘good’ AAPL seems, the market decides the price and it will be up to Apple to tell their story well enough to excite the market. GOOG has done a great job in getting the market to believe in their products and services even though many of us would disagree with the story.
Google may have believers. But both Google and FaceBook really haven’t got a clue of how to make money on handheld devices.
Good news! Apple really understands how to make truck loads of money in the NEW handheld device markets. They innovate, patent and then make the devices.
I invest with the one that has the plan, the market share and the world in their hand, Apple!
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AAPL adds millions of dollars everyday to there burgeoning hedge fund. Every AAPL stock gains more cash everyday to its value
It might just be a question of semantics, but I would never say “the market is always right,” but rather, the market has the final say. Clearly the market is wrong in this case, as they are over and over when it comes to AAPL.
The weatherman is sometimes right but the weather is always right.
How can people be so confused about the value of a stock? Down 3.6% one day, up 4% the next, and then down another 1.5% in mid-day trading on the third?
It’s those hedge funds constantly churning the stock. They can’t make any money on a stock that runs flat. If it were individual investors owning Apple, it couldn’t have this sort of volatility every day. It’s those hedge fund pricks selling off or buying millions of Apple shares at a moments notice and there’s probably lots of collusion going on among hedge funds. It’s just individual Apple shareholders’ bad luck to have to be dragged all over the place by those freaking hedgies. They ought to be limited on how many times they can trade a stock within a certain period of time.
Zaky: Apple clearly a much better investment opportunity than Google
Mybe zaky is a nice guy I don’t know. but I can tell hes not the smartest invester.
Market is always right except in the case of AMZN. Actually, in the age of high frequency trading when hundreds of large orders issued and cancelled by hedgies in a fraction of a second just to pump or take down a stock at any time with total impunity, the market is wrong more often than you think. Wake up and smell the coffee.
Remember that as an investor, you are buying into a company, not pieces of paper, real or electronic. Take a hard look at the intrinsic valuations of both Apple and Amazon and you will see a dramatic difference. Apple’s PE and PEG are significantly lower than Amazon and Apple’s earnings and margins are dramatically higher. While Amazon remains an interesting momentum purchase, Apple is the true value of the two. When you buy a share of Amazon stock, you do so at a tremendous premium, and you are depending on the momentum to make money. With Apple, you are buying a company whose stock is priced below its intrinsic value, and in the long term, you will stand to make a lot more money on your investment.
Peter Lynch, one of the brightest, most successful and sound investing minds explained clearly and convincingly in his book One Up On Wall Street that a stock’s price will eventually match up with its earnings. The two don’t march in lock-step. But in time, they do. What the means is that the market will eventually correct for the disparity between price and earnings. And that means for the patient investor, Apple will make you a lot more money based on its growth.