Apple passes Google in value; is this a changing of the guard?

“As has been duly noted elsewhere, Apple passed Google in total market cap,” Peter Burrows reports for BusinessWeek.

Related MacDailyNews articles:
• Apple again worth more than Google – July 22, 2009
• Apple now worth more than Google – August 13, 2008

Burrows continues, “At the close of the day’s trading, AAPL is worth $147.56 billion, while GOOG is worth $144.2 billion… That’s already bringing plenty of mano a mano comparisons as to which company is better situated for the future. [Google CEO Eric Schmidt’s] departure might have led to gradually changing perceptions about the heat of this rivalry, the fact that Apple overtook Google in value so soon after will only accelerate the trend.”

Burrows wonders, “So have we just witnessed a real changing of the guard for the No. 2 spot on the list of tech’s most valuable companies? Is Apple now the nearest rival to Microsoft, which remains far ahead with a market cap of $208.69 billion? Or is this a short-term phenomonon [sic]?”

Full article here.

MacDailyNews Take: This is the second August in a row where Apple’s value exceeded Google’s. Only time will tell if Apple can keep it ahead; with iPhone’s gigantic future revenue potential — along with Mac sales that continue to outgrow the PC industry as a whole — becoming apparent to more and more investors with each passing day, Apple has a shot at staying ahead of Google’s market cap. And, Microsoft is actually not that far ahead; not given how rapidly Apple’s market cap has been known to change vs. how stagnant Microsoft’s is by comparison.

24 Comments

  1. Really big giant with a really small [PC] realm. Reminds me of the dragon from “The Hobbit”. Except steeling this dragon’s golden trade secrets sounds a much more dangerous proposition.

    Psystar your thoughts?

  2. Can someone educate me a little about market cap? I mean, if Apple were to buy, say, Netflix or Adobe (I’m just hypothesizing… don’t go cramming the thread with hate), would that company become part of their market cap or would their cap diminish by the amount they spent on the acquisition? And obviously their stock would rise or fall some depending on how people viewed the acquisition…

  3. From the graph in the article, and the back MDN articles referenced, it seems that AAPL and GOOG have been trading the lead for a few months.

    Report back when the lead becomes bigger and does not change for several quarters. Then it will be worth analyzing.

    Right now you are just reporting market noise.

  4. aka Christian:

    It would depend on how Apple were to acquire that other company. If they were to spend some of their own cash (now around $30B), it wouldn’t directly affect market cap, other than what the perception of the stock value would be after such an acquisition (i.e. if the investors would start dumping AAPL stock, or accumulating it, lowering or raising its price in the process). If it were to be through some stock swap, the total number of outstanding shares may change, and market capitalisation may be affected as a result. But not by much, though.

  5. @ aka Christian

    Market capitalization (cap) = price per share * (multiplied by) the number of outstanding shares.

    If a company, like AAPL, buys another company for cash, then the number of outstanding shares would not change. However, Wall St. would react and the price per share would likely change.

    If the acquisition was made with a stock swap, then the number of outstanding shares might change, and that new number of and any Wall St. reaction would affect the market cap.

    To directly answer your question, yes, the acquisition would be added to AAPL’s market cap. However, Wall St. has the final say on the value.

    Hope this helps.

  6. Actually if Apples market cap grows bigger than Microsofts, and stays there, it could be a real stock value changer.

    It would point out just how close in size Apple is to Microsoft. And when the GIANT is no longer so big, maybe people will see how the giant is really been shrinking all along.

    could be a real game changer.

    Just a thought. en

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