Apple closes in on $775B market cap, now twice as large as No. 2 Exxon Mobil

Posted:
in AAPL Investors edited March 2015
Apple stock hit a new high of $133 at the closing bell on Monday, rocketing up 2.7 percent on the day to grow its market capitalization to just under $775 billion, a number two times larger than second-largest publicly traded U.S. company Exxon Mobil.



After making history earlier in February by becoming the first U.S. company in history with a $700B market cap, Apple shares continue to soar, rising nearly 22 percent since the beginning of 2015.

Calculating company value by market cap, Apple is now worth twice as much as Exxon after the oil giant's shares dipped one percent today to close at $89.01, with a market cap standing at just under $374 billion. Apple first passed Exxon as the world's largest company in 2011 with a market cap of $346.74 billion.

As noted by The Wall Street Journal, Apple's doubling up on Exxon is a rare event for publicly traded companies, one most recently witnessed by IBM 30 years ago. During a stretch between 1984 to 1985, IBM's year-end value was more than two times that of the next-largest company, which happened to be Exxon at the time.

Apple's high-flying performance comes after the iPhone maker posted the biggest quarterly profit of any company in history at the end of quarter four last year. For the three-month period ending in December, Apple raked in $18 billion in profit on revenue of $74.6 billion, much of which came from booming sales of the large-screened iPhone 6 and iPhone 6 Plus handsets.

In November, a number of hedge funds predicted 2015 could be the year in which Apple becomes the first company in history to see its market cap hit the mythical $1 trillion barrier, which at this point is a 30 percent hop away.
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Comments

  • Reply 1 of 125
    I definitely believe a Apple could reach $1T in 2015.
  • Reply 2 of 125
    Quote:

    Originally Posted by SolipsismY View Post



    I definitely believe a Apple could reach $1T in 2015.

    Unlikely, if they keep repurchasing shares at the recent rate....

  • Reply 3 of 125
    Unlikely, if they keep repurchasing shares at the recent rate....

    Do you have numbers to show how their current buyback program will prevent them from ever reaching a $1T market cap?
  • Reply 4 of 125
    And when they do it all the haters will claim that they are too big and should be forced to sell off parts of the company.
  • Reply 5 of 125
    Is this higher than any other company in history after accounting for inflation?
  • Reply 6 of 125
    bro2ma wrote: »
    Is this higher than any other company in history after accounting for inflation?

    No, Microsoft still holds the inflation adjusted record for now, but Apple is getting close.
  • Reply 7 of 125
    [/quote]
    As noted by The Wall Street Journal, Apple's doubling up on Exxon is a rare event for publicly traded companies, one most recently witnessed by IBM 30 years ago. During a stretch between 1984 to 1985, IBM's year-end value was more than two times that of the next-largest company, which happened to be Exxon at the time.[/quote]

    Cautionary tale for the future?
  • Reply 7 of 125
    Quote:

    Originally Posted by SolipsismY View Post



    Do you have numbers to show how their current buyback program will prevent them from ever reaching a $1T market cap?

    No, I don't. In any event, it requires making predictions about a market price, which I don't do.

     

    Also, where did I say 'ever'? You said '2015' and I was responding to that.

  • Reply 9 of 125
    lkrupplkrupp Posts: 9,462member

    And when AAPL exceeds $843 billion (Microsoft’s “adjusted for inflation” peak) the usual suspects will come up with another yes-but reason Microsoft still wins. I read an article to day by some asshole at Business Insider who pointed out that, adjusted for inflation, the Dutch East India Company was worth over $7 Trillion at its peak around the year 1679. Yes, they will stoop that low to denigrate Apple. They simply WILL NOT accept that Apple is a successful company. 

  • Reply 10 of 125
    Quote:

    Originally Posted by TheWhiteFalcon View Post



    No, Microsoft still holds the inflation adjusted record ....

    Frankly, no one seems to care much about this, except you who seem to bring it up every opportunity you get. You repeatedly ignore the point that MSFT's PE ratio was ridiculous then, and it was in the midst what is now well-known and well-accepted to be a price bubble. Do you recall what optical networking companies were worth then? A fibre optics company like Corning? Yahoo? Leaving aside such serious companies, do you recall pets.com? Webvan? AOL?

     

    As an aside: What do you use for 'inflation' to adjust market caps? PPI? CPI? US rates? Some blended rates to reflect the fact that MSFT is a global company? Why?

  • Reply 11 of 125
    dcj001dcj001 Posts: 301member

    Mikey Campbell wrote:

     


    Quote:
     $775 billion, a number two times larger than second-largest publicly traded U.S. company Exxon Mobil.

     



    $775 billion is not two times larger than Exxon-Mobil’s market cap. $775 billion is about two times as much as, or about 100% more thanExxon-Mobil’s market cap. 


     


    If Mikey Campbell is unable to understand this simple concept, he should not write about anything having to do with mathematics.

     

    If you think that he is correct, how much is one time larger than second-largest publicly traded U.S. company Exxon Mobil?

  • Reply 12 of 125
    No, I don't. In any event, it requires making predictions about a market price, which I don't do.

    Also, where did I say 'ever'? You said '2015' and I was responding to that.

    Mea culpa. I assumed that your comment about them keeping up their buyback program would continue to cause this issue in the future. I should have inquired first.

    So let's assume Apple will continue to buyback share (and issue dividends), can you give a loose prediction as to when you think $1T could then happen? If ?Watch has a successful launch, we get some good surprises at WWDC, and if my suspicions about this fiscal 2Q2015 being Apple's largest for 2Q, I think this could happen before the next iPhone is released, without changing the buyback program.
  • Reply 13 of 125
    Quote:

    Originally Posted by bro2ma View Post



    Is this higher than any other company in history after accounting for inflation?



    Yes, Microsoft (800+ billion at peak, adjusted for inflation), and topping all recent records, IBM in 70's sometime at 1.4 trillion, adjusted for inflation.

     

    I read it on Wikipedia, so it must be true (!)

     

    (Writing on the fly at the moment so this is from sketchy memory after looking into it a couple of months ago.)

  • Reply 14 of 125
    lkrupp wrote: »
    And when AAPL exceeds $843 billion (Microsoft’s “adjusted for inflation” peak) the usual suspects will come up with another yes-but reason Microsoft still wins. I read an article to day by some asshole at Business Insider who pointed out that, adjusted for inflation, the Dutch East India Company was worth over $7 Trillion at its peak around the year 1679. Yes, they will stoop that low to denigrate Apple. They simply WILL NOT accept that Apple is a successful company. 

    Yes, Microsoft (800+ billion at peak, adjusted for inflation), and topping all recent records, IBM in 70's sometime at 1.4 trillion, adjusted for inflation.

    I read it on Wikipedia, so it must be true (!)

    (Writing on the fly at the moment so this is from sketchy memory after looking into it a couple of months ago.)

    I am trying to wrap my head about adjusting for inflation when talking about these market caps. It doesn't make any sense to me when referring to a market cap.
  • Reply 15 of 125
    flaneurflaneur Posts: 4,526member
    boeyc15 wrote: »
    As noted by <em>The Wall Street Journal</em>, Apple's doubling up on Exxon is a <a href="http://blogs.wsj.com/moneybeat/2015/02/23/apple-is-now-more-than-double-the-size-of-exxon-and-everyone-else/">rare event</a> for publicly traded companies, one most recently witnessed by IBM 30 years ago. During a stretch between 1984 to 1985, IBM's year-end value was more than two times that of the next-largest company, which happened to be Exxon at the time.[/quote]

    Cautionary tale for the future?[/quote]

    Yes, IBM started to have difficulties after eighty years of solid competence, so maybe Apple should start looking over their shoulder around 2050, just in case.
  • Reply 16 of 125
    lkrupplkrupp Posts: 9,462member
    Quote:

    Originally Posted by SolipsismY View Post







    I am trying to wrap my head about adjusting for inflation when talking about these market caps. It doesn't make any sense to me when referring to a market cap.



    It makes perfect sense when the motive is to trivialize Apple’s achievements.

  • Reply 17 of 125
    Quote:

    Originally Posted by lkrupp View Post

     

    And when AAPL exceeds $843 billion (Microsoft’s “adjusted for inflation” peak) the usual suspects will come up with another yes-but reason Microsoft still wins. I read an article to day by some asshole at Business Insider who pointed out that, adjusted for inflation, the Dutch East India Company was worth over $7 Trillion at its peak around the year 1679. Yes, they will stoop that low to denigrate Apple. They simply WILL NOT accept that Apple is a successful company. 


    But what was the Dutch East India Company's P/E ratio? (Although, even accounting for Tulip-mania, it must have been a company worth a lot of money.)

     

    There's a Motley Fool article about this from back in 2012. At least the author admits that it's a hard comparison to make, and doesn't lessen Apple's achievement, really, because it was a very different era.

    http://www.fool.com/investing/general/2012/08/22/a-history-of-ridiculously-big-companies.aspx

  • Reply 18 of 125
    But what was the Dutch East India Company's P/E ratio? (Although, even accounting for Tulip-mania, it must have been a company worth a lot of money.)

    There's a Motley Fool article about this from back in 2012. At least the author admits that it's a hard comparison to make, and doesn't lessen Apple's achievement, really, because it was a very different era.
    http://www.fool.com/investing/general/2012/08/22/a-history-of-ridiculously-big-companies.aspx

    On top of P/E, the health of the economy come to mind as other areas that would need to be considered. If the Dutch East India Company is worth an adjust $7T was there any other companies in that trillion dollar range? I would imagine there are many, but if not, I'd say that the leading publicly traded company at the time being more than 7x large than the 2nd largest company would be very impressive. It would certainly be more impressive than Apple is now only being 2x that of Exxon (and IBM only 2x Exxon 3 decades prior).
  • Reply 19 of 125
    Quote:

    Originally Posted by SolipsismY View Post





    On top of P/E, the health of the economy come to mind as other areas that would need to be considered. If the Dutch East India Company is worth an adjust $7T was there any other companies in that trillion dollar range? I would imagine there are many, but if not, I'd say that the leading publicly traded company at the time being more than 7x large than the 2nd largest company would be very impressive. It would certainly be more impressive than Apple is now only being 2x that of Exxon (and IBM only 2x Exxon 3 decades prior).



    The Motley Fool article does seem to imply no other company was valued even closely to that, so it does seem impressive - especially since it was the first publicly-traded company ever. In a way, though, I guess being the first may explain why it was worth so much, as investors didn't have a lot of other companies to invest in. On the other hand, there were also much fewer investors... there are a lot of variables that are very difficult to work out.

     

    On another point, has Exxon been the largest  or second-largest company that entire 30 year period? That's remarkably consistent.

  • Reply 20 of 125
    On another point, has Exxon been the largest  or second-largest company that entire 30 year period? That's remarkably consistent.

    It's been up there, I'm just not sure to what extent. It's certainly impressive and probably worth studying.


    edit: Wikipedia's entries indicate that you have to go back to 2003 before Exxon falls to the 3rd highest valuation. Of course, that doesn't include any intra-day or intra-quarter changes that may have put Exxon lower, even for a brief time.

    Starting from 1996, their earliest listing, Exxon was ranked

    • 1996 — 5th highest
    • 1997 — 4th highest
    • 1998 — 3th highest
    • 1999 — 8th highest (dotCom boom and MS' pea)
    • 2000 through 2003 — 3rd highest
    • 2004 through Today — Either 1st or 2nd highest
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