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Does Apple > (Microsoft + Google + Amazon + Facebook) ?

August 28, 2012 | About:
Intelligent Speculator

Intelligent Speculator

6 followers
Believe me, I’m a huge fan of Apple (AAPL). Not just its amazing products (I own an iphone and ipad) but the stock. I called those who didn’t hold it crazy, put it at the top of my technology rankings, picked it several times in long & short tech stock picks and as one of my 4 picks for the stock picking contest (which I currently lead thanks to that pick). Still though, I can’t say that I feel as convinced when I see this:

AAPL > MSFT+GOOG+AMZN+FB

That is how those companies are being valued in the markets right now. Would you prefer owning Apple of all of those? In other words,

What group of products & teams would you prefer between these two:

Amazon.com, the world’ largest online store and emerging distribution powerhouse

Kindle tablets

Audible.com

Zappos

Windows Operating System

Office suite

xBox

Bing.com (2nd most popular search engine)

Google.com (top popular search engine)

Google docs software

Android mobile O/S

Motorola

Google+

Google’s vast projects

Facebook (top social network)

Instagram

Etc, Etc, Etc

Or

iPhone

iPad

Macbook

iPod

Etc

Don’t get me wrong, those Apple products are amazing, they dominate their markets for the most part, they continue to grow and there are projects for Apple to launch its anticipated Apple TV. All of that being said, simply looking at it, it’s difficult to imagine that I could pick Apple if I were given the choice between those 2.. How about you?

Take a look at the financials of these companies. First the data:



TickerNamePriceEPSPE RatioPE Next YearReturn YTDSales GrowthAnalyst ratingBook ValueBetaMarket Cap
AAPLApple Inc675.6828.0515.5912.5364.4665.964.65119.231 $633,386,500,000.00
MSFTMicrosoft Corp30.692.0211.159.1820.075.404.467.920.9 $257,286,453,125.00
GOOGGoogle Inc669.2230.1719.9313.775.0729.284.61199.210.99 $219,516,406,250.00
FBFacebook Inc19.150.5242.1930.37#VALUE!87.993.943.22N/A $46,254,289,062.50
AMZNAmazon.com Inc243.921.39273.0459.9141.9640.564.2716.61.2 $110,267,757,812.50
Total $633,324,906,250.00

Sales:



CQ4 2010CQ1 2011CQ2 2011CQ3 2011CQ4 2011CQ1 2012CQ2 2012
AAPL20343.0026741.0024667.0028571.0028270.0046333.0039186.00
MSFT16039.0016195.0019953.0016428.0017367.0017372.0020885.00
GOOG8440.008575.009026.009720.0010584.0010645.0012214.00
AMZN12948.009857.009913.0010876.0017431.0013185.0012834.00
FB731.00731.00895.00954.001131.001058.001184.00
Sum MSFT+GOOG+AMZN+FB38158.0035358.0039787.0037978.0046513.0042260.0047117.00

Income:



CQ4 2010CQ1 2011CQ2 2011CQ3 2011CQ4 2011CQ1 2012CQ2 2012
AAPL4308.006004.005987.007308.006623.0013064.0011622.00
MSFT4518.005410.006634.005232.005874.005738.006624.00
GOOG2543.001798.002505.002729.002705.002890.002785.00
AMZN416.00201.00191.0063.00177.00130.007.00
FB251.00233.00240.00227.00302.00205.00-157.00
Sum MSFT+GOOG+AMZN+FB7728.007642.009570.008251.009058.008963.009259.00
Then the charts:

Sales:

sales.png

Income:

income.png

It’s quite interesting. In all but the last 2 quarters, the group has outperformed Apple in terms of income while Apple only beat on revenues once. So my question to you is quite simple. Which one would you pick. Would you buy Apple or Google+Microsoft+Facebook+Amazon. I personally could not pick Apple in such a case… does that mean Apple is overvalued? Or are some (or all) of the others undervalued?


Rating: 4.2/5 (12 votes)

Comments

kfh227
Kfh227 premium member - 2 years ago
You should do the same comparison, but for debt free companies, back cash/equivilents out of the market cap.

AlbertaSunwapta
AlbertaSunwapta - 2 years ago
It's not about the number of brands and degree of brand diversification, it's about the economics, earnings power, franchise power and moat of the brands you control. Moreover Apple's cash levels can allow it to change much of its own economics overnight. Were Apple to buy IBM, Qualcomm, Sony, Cisco, or any number of other companies it's future prospects would change dramatically. Apple has the power to create novel and enorormous synergies.

I own Apple shares but ten times more MSFT. Apple though is a far higher quality company. MSFT is just temporarily undervalued.
Adib Motiwala
Adib Motiwala - 2 years ago
Nice idea. I would throw out FB and AMZN from that list as the former is unproven and overvalued. AMZN gives you sales but not profits. Maybe throw in Intel instead. Much better value there. And I am sure some would prefer a CSCO...
kfh227
Kfh227 premium member - 2 years ago
IMHO, Apple and Google have done nothing to innovate in 5 years. The only change is that you can now talk to your phone. With new phones coming out from MSFT and RIMM, they may be the ones being poked fun at for resting on their laurels.



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