Alphabet Inc. may soon dethrone Apple as the world’s most valuable company

“As the digital advertising market booms and demand for smartphones wanes, Alphabet Inc. could soon dethrone Apple as the world’s most valuable company,” Michael Liedtke reports for The Associated Press. “If it happens, Alphabet will move to the head of the class just five months after Google reorganized itself under the holding company.”

“The Silicon Valley rivals could trade places as early as Friday, given how rapidly the financial gap between them is narrowing. At the end of trading on Thursday, Apple’s market value stood at $522 billion; Alphabet was worth $515 billion,” Liedtke reports. “That’s a dramatic swing from where things stood just 13 months ago. Apple then boasted a market value of $643 billion, almost twice Google Inc.’s $361 billion.”

Liedtke reports, “The company has struggled to come up with another trend-setting product amid slumping sales of its most important device — the nearly 9-year-old iPhone, which accounts for roughly two-thirds of Apple’s overall sales.”

MacDailyNews Take: Apple just posted all-time record sales of iPhone, 74.779 million units in 91 days, and The Associated Press is reporting it as “slumping sales.” Keep that in mind when you read other articles from The Associated Press.

“Investors also have applauded the creation of Alphabet, which is structured to provide more information about the cost of the company’s experimental ventures into self-driving cars, Internet access services, health science and city management,” Liedtke reports. “All of those factors have helped lift Alphabet’s stock — previously Google’s — by 41 percent since the end of 2014.”

“It’s a potentially big shift for Apple, which has held bragging rights as the world’s most valuable company for most of the past four-and-a-half years. (ExxonMobil seized the high ground for a brief time in 2013),” Liedtke reports. “Alphabet would become the 12th company to rise to the most valuable spot, according to Standard & Poor’s.”

Read more in the full article here.

MacDailyNews Take: Losing the title of “the world’s most valuable company,” will only ratchet up the pressure on Apple Inc.’s management. For Tim Cook, especially, there will be nowhere to hide from investors, especially with the stock doing so poorly. Market valuation is largely out of Cook’s direct control; execution, attention-to-detail, and properly-stocked launches are not.

If you bought AAPL one year ago today, you’re currently down $24.81 per share excluding dividends totaling a mere $1.56.

SEE ALSO:
Alphabet Inc. close to snatching Apple’s crown as the world’s most valuable company – January 21, 2016
Is Alphabet Inc. about to dethrone Apple as the world’s most valuable company? – January 14, 2016
Apple could soon lose its place as world’s most valuable company to Google – January 13, 2016
Apple’s rotten year on Wall Street and, look out, here comes Google in the market cap race! – December 30, 2015
2015: Apple’s year in beta – December 29, 2015
​Apple’s dirty little secret: Sucky software – why Apple’s entire UX/UI team needs to be fired – November 19, 2015
What Steve Jobs gave Apple that Tim Cook cannot – November 18, 2015
Alternatives to Apple’s bloated iTunes – November 17, 2015
Apple’s new iPad Pro debuts with forced reboots, missing Apple Pencils – November 16, 2015
Apple’s perplexingly incomplete launch of the iPad Pro – November 16, 2015
Open letter to Tim Cook: Apple needs to do better – January 5, 2015
Apple’s major problem is Tim Cook – November 16, 2015
At Apple, it seems as if no one’s minding the store – November 13, 2015
Houston Chronicle’s Silverman reviews new Apple TV: This cake needed more baking – November 9, 2015
The new Apple TV has more rough edges than a sack of saw blades – November 3, 2015
Apple Music one month later: Not loving it, but I’ll be subscribing to it – August 10, 2015
The tragedy of iTunes: Nothing ‘just works’ – July 28, 2015
Apple Music, both on iOS and OS X, is an embarrassing and confusing mess – July 10, 2015
After many of complaints about Wi-Fi issues, Apple dumps discoveryd in latest OS X beta – May 27, 2015
OS X 10.10.2: Wi-Fi problems continue to plague some Mac users – January 30, 2015
The software and services that Apple needs to fix – January 14, 2015

30 Comments

  1. I have a tough time understanding how Amazon is valued as high as it is (although recently she fell again.)

    I have a tough time understanding how Facebook is valued as high as it is.

    I have a tough time understanding how Google could be valued more than Apple is.

    1. Shares outstanding multiplied by share price. That’s how.

      MDN is right. The pressure will on be Cook, who’s gotten mostly a free pass so far (Jobs’ death sympathy and then riding on the coattails of products developed under Jobs). It’s make or break time now. Hopefully he can deal with it and rise to the challenge.

      1. Ya, I kinda know how to calculate market cap.

        But it still baffles my mind. Amazon rarely makes a profit and FB and Google are basically involved in advertising. Apple creates new markets and has real products people want.

        I guess what I am saying is I just don’t understand people.

          1. I am puzzled how some people can believe Google shares are worth 33x that company’s earnings, and an even greater/sillier EPS multiple for Amazon …yet investors are quaking in their boots about an Apple multiple of only about 11.

            I think _this_ is what many people find puzzling. Not how it is calculated formulaically …but how people can think this way.

  2. If so, this happened on Tim Cook’s watch.

    How about putting aside the Gay Pride Parades and “Global Warming” bunkum and concentrating on making products and services worthy of the Apple logo for a change?

    Or GTFO, Cook, and let somebody who understands that their job is not to be a promoter of left-wing progressive agendas, but to be “dedicated to making the best products on earth.” Period.

    1. Like it or not, Cook set himself up for this sort of reaction. He could get away with it while Apple was doing well. Not sure he can with the company regularly screwing up launches and with the share price in the crapper.

    2. It’s not everyday you come across an actual grown moron that can’t do basic maths and physics. Well maybe you do in places like Somalia or Pakistan where they’re two a penny

    3. Well is see your another stock market sheep, the Banking groups must live you they are laughing all the way taking your money then manipulating the market to their own gain.

    4. Umm there is this thing called the board of directors that Mr. Cook answers to.
      Singling him out and making borderline bigoted comments about him really is not constructive.

  3. “…Alphabet, which is structured to provide more information about the cost of the company’s experimental ventures…”
    meaning:
    …Alphabet, which is structured to distract from the one-trick-pony nature of its business…

  4. It is wrong to say that Stock price is not within control of the CEO. It is the reflection of choices that TC has made. When you send the message to the Street that you are now a dividend paying company, what kind of valuation do you expect? You are not a growth company any more. There were several ops for expanding the base of Apple: Tesla and Netflix could have been acquired at an affordable price. Apple could buy Twitter and turn it into a competing social network. Cook did none of that. He was even slow in coming up with large size iPhones. iPad Air has not been refreshed for two years. Apple has no search engine, nothing that competes with YouTube. $140 billion wasted in share buybacks and dividends if properly used would have created a different Apple today. Yes, Cook is responsible for what is happening to the stock.

  5. Aside from whatever Tim Cook could have done differently you have to question the irrational love the market shows for companies like Amazon and Google (Alphabet).

    Amazon sells lots of stuff but makes little money on it. Does the market see massive room for growth in online sales? Does it think they will somehow be able to start turning massive profits without raising prices (and then losing sales)?

    Google makes money on advertising and then throws it away on all sorts of money losing products. Where is their meaningful (profit making) growth coming from.

    One of the main things behind the market’s treatment of Apple seems to be this thought that one day they will just collapse, that sales won’t just stop increasing in growth but that they will stop entirely and that they will then burn through all their cash without turning it around. Microsoft never made anything decent and look how slow their death has been, so slow that they can spend $400m on getting surface tablets into the nfl that then don’t work!

    I think Tim Cook could have done things better, but that would have just resulted in slightly more record breaking figures and possibly just hastened the proclamations of doom from the market.

  6. What so Facebook is a website dedicated to: pictures and videos of cats licking their butt holes, pictures of peoples kids, meems and sympathy likes and its valued at $300 billion!!!

    Google that tracks the hell out of you and invades your privacy, with less total revenue per year than Apples last quarter!!! Valued at $515 billion

    Wow all companies should ditch the stock market its just for hedge fund managers and stock brokers to make billions per year, its just its a big gambling con created by the worlds super elite like the Bilderberg group and the other large banking groups. All companies should become self owned or partnerships.

  7. Google, sorry “Alphabet” loves to expose much or all of its R&D directions, even though, over and over, they never come to fruition, die on the vine, or are rejected by the public (google glasses). Wall Street analysts and investors like this and get all excited – its like shaking shiny keys in front of an infant – “ohh, isn’t Alphabet innovative…” (smirk), or worse, “isn’t Samsung innovative.” (just threw up in mouth).

    Apple chooses not to expose its future plans, as they have so many copiers/thieves in the market (including Alphabet), who jump into the marketplace with ill-thought out products based just on rumors of Apple product development, still believing that first to market is always a pathway to success, or, at least, bragging rights (e.g. the plethora of “smart” watches that hit the market after the rumors began concerning Apple’s plans). When Apple finally makes their product features known – the copiers go into overtime.

    Wall Street doesn’t like Apple’s secrecy – it is one of the reasons they punish Apple, even when Apple puts up numbers that would make any other company’s stock skyrocket.

    Also, because anything with Apple in the title is click-bait, and because of Apple’s success, secrecy and other factors, Apple is the perfect plaything for options traders – write gloom and make money as they short and then praise/give way to fact and make money when the stock rebounds. Technically, I think stock manipulation is illegal – but, hey, when has that stopped Wall Street. I think there needs to be an analyst scoring system based on how accurate their predictions are – and, they should be required to place that score in the title of every piece they write and announce it on every phone call with investors.

    We need to regulate out the institutionalized stupidity that hurts everyone else – local and world economies (why did we allow regular banks back into high-risk investments? why do we allow investment banks to astronomically over-leverage themselves {and don’t forget how over leveraged the Central Bank is] and then come begging to the taxpayer to cover their stupid bets). We need to start to encourage long-term thinking – among CEOs, among investors – how about bigger taxes on high-risk investments, and bigger tax-breaks on investing in companies that meet sustainability criteria: 1) must be profitable; 2) must contribute to society (local jobs, healthcare; then societies elsewhere (local fair-pay jobs, healthcare); and 3) don’t hurt the environment. The fact that these ideas sound so foreign and “out-there” shows how duped we have become into believing things have to stay how they are. The fact is – they can’t – it will all crumble.

    Boy, THAT tirade took a bit of twist (sorry)! I just have a low tolerance for the sanctioned stupidity of Wall Street’s current practices. And you know what – they LAUGH at how they crashed world economy in 2008 and then still got rewarded with bonuses by getting the taxpayer to bail them out. Maybe we should bail out everyone who loses the most money in the Casinos, and let them seize the houses of the people they convinced to take big housing bets. The problem is – we say we won’t bail them out again, but the too big to fail banks are even bigger now, and when capital world wide stops flowing, we will likely do it again, not wanting to face the horror on the other side of letting them fail – something that will make the Great Depression look like a party.

    Sorry, went off again… :- |

  8. ROI based ad-spending and other trends are going to kill search based ads. Search is going to get commoditized. Google is going to become a single product company relying on YouTube for ad revenue until Congress reinforces the copyright and royalties laws and Google is forced to pay the Screen Actor Guild and residuals. Alphabet is a brilliant attempt to Obfuscate the problem by throwing a lot of R&D money at the wall and seeing if something sticks.

    we pulled $50K out of $60K adwords spending in 2015 and put it into content amplification services like OUTBRAIN, etc. because Google click fraud was too high. we might pull the remaining adwords spending, too, and display, unless the click fraud is dealt with. Now that Google is providing account services and a lot more training on their product, advertisers are realizing that the default Adwords settings are designed to bilk them out of $1000s of dollars and now that they are able to properly measure the ROI – the ROI can SUCK! (It really depends on the business, though, on higher margin products, we are still killing it on adwords, but could do better. For low margin it is just not working anymore.)

  9. Android made a billion since it came out. Apple does that in one quarter. Apples stock is so under priced compared to the value of the company and how much cash it has on hand.
    Apple posts record quarters for the last 10 years with its last quarter being the single most profitable in history of any company and the market treats the company like shit and has for several years. Always trying to spin the negative into some doom and gloom.

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