iBubble: Apple's Market Cap Is Now The Same As The Entire Retail Sector, Bigger Than All The Semis

Tyler Durden's picture




 

This is simply stunning: one company, which has two flagship products, has a bigger market cap than the entire Semiconductor space, and is just shy of the entire S&P Retail sector.

The 216 hedge funds in the name as of December 31 is hopelessly stale. We are certain that by now this number is at least 250, if not 300.

Sustainable:

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Tue, 02/28/2012 - 15:14 | 2204970 goldencross10
goldencross10's picture

Weak US dollars help

Tue, 02/28/2012 - 15:15 | 2204979 firstdivision
firstdivision's picture

Stupid US consumers help a lot.

Tue, 02/28/2012 - 15:18 | 2205004 Troll Magnet
Troll Magnet's picture

iPad 3 on March 7th!  skip your meals and buy one!  it'll make you "look" rich and cool!

Tue, 02/28/2012 - 15:19 | 2205008 TruthInSunshine
TruthInSunshine's picture

Everything's coming up iTulips.

Apple has to much cash, and wants to bail PIIGS out.

Tue, 02/28/2012 - 15:20 | 2205015 American34
American34's picture

Durden, you should Tweet concerning this to Trump and Buffet to see what their responses are!

Tue, 02/28/2012 - 15:29 | 2205059 Pladizow
Pladizow's picture

SSSHHHHH, youll wake the sheeple and they love apples!

Tue, 02/28/2012 - 15:33 | 2205090 Comay Mierda
Comay Mierda's picture

just heard a ditz in my office say she just bought AAPL cuz she likes siri.  the sheep are about to get FLEECED.  AAPL is showing a typical bump-and-run reversal pattern.  but there will be several more days of cramer pumping up this piece of shit before it collapses

Tue, 02/28/2012 - 15:43 | 2205151 Michael
Michael's picture

The S & P should currently be in the 400-500 range. The current stock market/money bubble is going to pop in spectacular fashion just like it did back in 2000.

Tue, 02/28/2012 - 15:44 | 2205157 TruthInSunshine
TruthInSunshine's picture

Activist Apple shareholders want management to buy South America.

Tue, 02/28/2012 - 16:10 | 2205288 Cheesy Bastard
Cheesy Bastard's picture

An iBubble usually ends in an iPopping fashion.

Tue, 02/28/2012 - 16:24 | 2205345 trav7777
trav7777's picture

aapl has 100B in cash, it's a cash machine.  There are tons of people willing to line up for days to buy their shit.

An "excessive" market cap is presently justified.  Until the trend sours on them, it is what it is.

Tue, 02/28/2012 - 16:43 | 2205405 Popo
Popo's picture

Agreed.  This article is fucking annoying.  Apple isn't a "two flagship product company".  Where the hell did that idiocy come from?  

Read this carefully:

First off, AAPLE is a top 3 leader in the MEDIA space.  Secondly, AAPL has single handedly destroyed the entire media retail industry from Virgin Megastores down.  It is laying waste to the digital camera industry from Olympus down,   it has all but annihilated the handheld phone industry leader Nokia and it is devastating the industry leader Microsoft in the OS sector.  

What we need to do isn't to laud Apple's successes, but to step back and appreciate the trail of absolute devastation that Apple has left in it's wake.

AAPL's market cap is *entirely* justified.  ***BUT***  that's NOT a buy signal.  It's a signal that Apple has annihilated a serious percentage of the viable stocks on the S&P and is as much of a sell-signal as much as a buy-signal.

Apple is a Shiva: devourer of worlds.   Don't for one second think that this is a sign of an expanding economy.   Ask anyone in the publishing business.  This is the end of the road.  Ask anyone at Blackberry or Nokia.  These are the end-days.    We are witnessing the wholesale destruction of value.  Yes, Apple is kicking ass.  No, it's not good.   AAPL should indeed be soaring.  But the indexes should be shitting the bed.

Tue, 02/28/2012 - 16:49 | 2205481 FlyoverCountryS...
FlyoverCountrySchmuck's picture

Apple's success is based on selling products people actually WANT to buy, and are willing to pay a premium for, manufactured at the lowest possible cost.

 

Compare this to Government Motors building products most people DO NOT WANT (Volts), giving away tax dollars to cronies to buy said product, stuffing it's dealer pipeline with unwanted product for political reasons to boost Manufacturing Output Numbers for the Administration, and then using the promise of government bailouts to get that same orgs financial arm to give credit to KNOWN CREDIT CRIMINALS to boost it's sales numbers for the very same political reasons.

 

Tue, 02/28/2012 - 17:12 | 2205549 JW n FL
JW n FL's picture

 

 

"An instant replay of these past few decades would have shown that accelerating asset prices were not due to any particular wisdom in the part of academia or the investment community but an offensively minded Federal Reserve and their global counterparts who were printing money, lowering yields and bringing forward a false sense of monetary wealth that was dependent on perpetual motion

http://www.investmentweek.co.uk/investment-week/news/2155760/gross-calls-offensive-strategy

Open Market Operations! BITCHEZ!!

Tue, 02/28/2012 - 16:54 | 2205519 Bangin7GramRocks
Bangin7GramRocks's picture

Well said.

Tue, 02/28/2012 - 21:18 | 2206379 Hard1
Hard1's picture

All I can say is sustainable sustainable sustainable sustainable sustainable sustainable sustainable sustainable sustainable sustainable sustainable sustainable sustainable sustainable sustainable sustainable sustainable sustainable sustainable sustainable sustainable sustainable sustainable sustainable sustainable sustainable sustainable sustainable sustainable sustainable sustainable sustainable sustainable sustainable sustainable sustainable sustainable sustainable sustainable sustainable sustainable sustainable sustainable sustainable sustainable sustainable sustainable sustainable sustainable

Tue, 02/28/2012 - 16:59 | 2205534 Dr. Engali
Dr. Engali's picture

I agree with a lot of what you said. Apple is upsetting the whole apple cart (pun intended) but there was another company in the 80's and 90's who upset the system and became the one game in town. People used to wait in line for it's new operating system too. That company was Microsoft. If you look at it's stock run up it was a lot like Apple. Eventually once the hot money left it was cut in half and hasn't done anything since. I love Apple products but it's stock will get creamed at some point as well.

Tue, 02/28/2012 - 17:02 | 2205560 Temporalist
Temporalist's picture

Olympus did themselves in and anyone that actually wants a camera doesn't buy a phone for one.

Tue, 02/28/2012 - 18:33 | 2205950 Race Car Driver
Race Car Driver's picture

I dunno, dude. My little Samsung phone has a whole lot of 3.2Mp camera functionality... just as good as any other general use digital camera. My digital Olympus collects dust because it's just not convenient to have to lug a phone and a camera around.

Soon we'll just have to tap the little apple logo on the chest of our uniform shirts and be able to do just about anything.

Tue, 02/28/2012 - 18:18 | 2205888 Race Car Driver
Race Car Driver's picture

> Apple is a Shiva: devourer of worlds.

+ Shiva!

Outstanding post.

Tue, 02/28/2012 - 16:44 | 2205441 I am a Man I am...
I am a Man I am Forty's picture

Right, sick and tired of ZH and RM bitching and moaning about apple.  The market cap is not excessive for how much they earn, not even close.

ZH has been wrong about apple and the iBubble headline is nonsense.  TD, do you understand how to evaluate what a company is worth??  You obviously don't, because if you did you would own apple and be making a shit ton of money like I am.

Tue, 02/28/2012 - 17:10 | 2205599 Midas
Midas's picture

Considering there is no dividend, when you say you are "making" money does that mean you are selling shares or writing covered calls?

Tue, 02/28/2012 - 17:49 | 2205755 earleflorida
earleflorida's picture

Question,... what happened to the almighty Mr. Softy [Microsoft] in 2003 when they issued their first-ever dividend [!!!] - 2:1 split, and a stock buyback?  Answer. MSFT became a commodity -- a no-growth enterprise. Unimaginably, just reinventing its "Shitless Monopoly on Licensed Software'! 

Where's it gone in a decade?

Now,... the "Apple-of-Your Eye's" is at that crossroad. Investors are now clamoring for a dividend pay-out annually, period! The obvious thing to do is a stock-split,... absolutely "NOT"[!] says the "BOD's"!

Today the almighty APPL closed at $535/share very close to the $600/ share target. That is,... we have approximately 10% of an upward move before it tops - or, until the assholes raise the current valuation.

Ain't gonna happen -- this fruit is spoiling on the tree as I write. All the upside is baked into this soon-to-be rotten apple pie.

Remember this,... once a dividend is announced, this 'Newtonian Sweet-Tart' will have lost its "Tangy", and will become the the breakfast of "HOG's" where your [I hope you are] familiar with the 'wise-old-wall-street-adage' -- "The Pigs get fed,... the Bulls get fed --- but the HOG's get Slaughtered!"

jmo     

Tue, 02/28/2012 - 17:46 | 2205758 absente reo
absente reo's picture

Good for you.  ZH is a fine blog, one of if not the best but it takes a certain degree of intelligence to be able to be a regular reader but also to hold positions that are diametrically opposed to those advocated either explicitly or implicitly in this blog.  Of course, at times it pays to follow the ZH crowd, but at times it does not.  Caveat: the ZH position on gold and silver speaks for itself.

Tue, 02/28/2012 - 18:00 | 2205827 NeoRandian
NeoRandian's picture

The problem with Apple is that it learned nothing in business school. The responsibility of a company is to maximize value for its shareholders, not create products and services that customers actually want.

If Apple had paid attention to Jensen and Friedman, it wouldn't need to worry about being a bubble; it would be as overleveraged and insolvent as all of its peers and the central banks would have less to worry about. 

Wed, 02/29/2012 - 00:45 | 2206932 Andre
Andre's picture

 

"The responsibility of a company is to maximize value for its shareholders, not create products and services that customers actually want."

Well, since American business is doing so well these days, I would say the idea does not have a ringing endorsement from anybody but the business school types.

A monomaniacal pursuit of "shareholder value" in the markets and the courts has led to (IMO) a hollowed out economy that will, by destroying the market (customers) and the society and economic system supporting it, achieve the utter opposite of the stated goal. Value is a dodgy thing when there are few customers and no effective laws.

 

Tue, 02/28/2012 - 16:28 | 2205365 Thomas
Thomas's picture

It is the indexers putting disproportionate money into the top of the indices. It works in reverse too!

Tue, 02/28/2012 - 16:58 | 2205543 economics1996
economics1996's picture

That bitch is distracting from your thought process.

Tue, 02/28/2012 - 17:24 | 2205658 astroloungers
astroloungers's picture

I have a furry mean donkey, my donkey wears a straw hat with his ears sticking up out of the hat.

My donkey loves apples,my donkey does not know much about finance but....my donkey will be pleased to know that most of the world is now made up of apple.

Tue, 02/28/2012 - 15:44 | 2205159 kaiserhoff
kaiserhoff's picture

Relax Tyler.  It's different this time;)

Tue, 02/28/2012 - 15:54 | 2205208 Buckaroo Banzai
Buckaroo Banzai's picture

I dunno. I would be more willing to call AAPL a bubble if the company would stop making so much g.d. money, or if any of their competitors (besides Samsung) actually made money.

Tue, 02/28/2012 - 16:04 | 2205260 GenX Investor
GenX Investor's picture

The algobot 3000's can only focus on so many presure points in the market.  We are all witness to the greatest game of prisoners delema in the history of man.  I just can't wait to see what price discovery will be when the sustainable turns to the unsustainable.  SPEC-TAK-U-LAAARRRR!!!!

Tue, 02/28/2012 - 16:49 | 2205488 mlbs
Tue, 02/28/2012 - 16:35 | 2205400 He_Who Carried ...
He_Who Carried The Sun's picture

That fruit is going to enjoy some hard landing, once it detaches from its tree...

Time to start shorting in about 6 months...

Tue, 02/28/2012 - 15:52 | 2205200 LasVegasDave
LasVegasDave's picture

Let them stand for delivery of all the gold and silver on the comex and distribute PMs to shareholders as a dividend

Tue, 02/28/2012 - 15:54 | 2205206 bdc63
bdc63's picture

iDontCare

Tue, 02/28/2012 - 15:56 | 2205219 MarcusLCrassus
MarcusLCrassus's picture

Except that Apples billions in cash is all stashed overseas where they can't get to it. If they want to access it they have to pay literally billions in taxes on it. 

 

So sure, on paper they have lots of cash, but is it even still there?  How many times has it already been rehypothecated by the banks in London and Hong Kong? 

 

That would be a real hoot to see Apple get MF Globalled. 

Tue, 02/28/2012 - 16:00 | 2205242 Unprepared
Unprepared's picture

Sir Isaac Newton would be proven right.

Tue, 02/28/2012 - 16:48 | 2205472 TarzanNe1
TarzanNe1's picture

You didn't happen to mean Sir iSaac Newton?

Tue, 02/28/2012 - 23:52 | 2206810 putaipan
putaipan's picture

whoa....nice triple entendre or inadvertantly deep quip given newton's

role in the establishment of the bank of england.

Tue, 02/28/2012 - 15:20 | 2205016 Osmium
Osmium's picture

Skip your meals?  Hell, skip your house payment and buy 2!!!

Tue, 02/28/2012 - 17:21 | 2205057 bdc63
bdc63's picture

what a silly comment ... everyone knows that American's stopped making their mortgage payments 2 years ago ...

Tue, 02/28/2012 - 21:22 | 2206392 Zero Govt
Zero Govt's picture

just after Greece then

..this Fuck-the-Bills Virus has gone international

Tue, 02/28/2012 - 15:32 | 2205088 knightowl77
knightowl77's picture

I'm buyen one....have been waiting and waiting....

Already have my food & bulets squared away....time for a little R & R

Tue, 02/28/2012 - 15:44 | 2205152 scatterbrains
scatterbrains's picture

I bought  10 of them..  Enterprize, Liberty and Goldrush. The Goldrush supposedly are good for up to 8 months cold storage.. oh wait you mean electronic gadgets ?

Tue, 02/28/2012 - 15:34 | 2205096 LouisDega
LouisDega's picture

Youre such a tease. How am i going to order an Ipad if i am dead?  Is there an iHeaven?

Tue, 02/28/2012 - 16:02 | 2205249 zebra
zebra's picture

New App to apply for food stamp will hit the AppStore soon.

it is called iStamp.

Tue, 02/28/2012 - 21:28 | 2206406 Zero Govt
Zero Govt's picture

Nope, JP Morgan has the commission on the Food Stamps App

..it's neatly correlated with creating unemployment by financially raping American taxpayers, pensioners and debt-slave students

Great business model America has

Tue, 02/28/2012 - 15:37 | 2205117 fonestar
fonestar's picture

+100

You have to wonder what Henry Ford or Howard Hughes would have to say if they saw what was left of the greatest manufacturing empire in history?  A bunch of useless dolts staring at themselves on Facebook all day and blocking out reality with the headphones attached to their iToy.

Die!

Tue, 02/28/2012 - 15:43 | 2205146 IEVI
IEVI's picture

At least Apple makes something. How about PCLN up $40 today. It's a fucking travel agency!

 

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