Google's 'enterprise value' surpasses Apple's by $8bn, analyst claims
Google, and not Apple, is now the world's most valuable technology company - if you use the less common 'enterprise value' rather than market capitalisation.
Google, and not Apple, is now the world's most valuable technology company. That's according to a financial pundit who has calculated Apple and Google's respective worths using the less common 'enterprise value' rather than market capitalisation, which still puts Apple top.
Moneybeat's Rolfe Winkler made the call in an article on Tuesday, in which he wrote that while the market capitalisations of the companies remain tilted in Apple's favour (Apple has a market cap of US$378bn while Google is barely worth notice on a mere $286bn), the enterprise values - calculated by removing each firm's cash holdings - puts Google ahead.
"The market [capitalisations] of both companies are swelled by their huge bank accounts," Winkler argues. "Strip out Apple's $145 billion of net cash as of March, and Google's $45 billion. This leaves an enterprise value of $233 billion for Apple, but $241 billion for Google, reflecting the underlying value of the companies' actual operations."
In essence this alternative metric is designed to measure the companies' activity rather than their static worth; the value of their operations rather than their bank accounts. Winkler tries to explain the choice of measurement with an analogy:
"Another way to think about it: If you bought a house for $378,000, but there was $145,000 of cash lying on the living room floor, all you really paid was a net $233,000."
But we're not sure that's terribly helpful for the financially illiterate like us.
As Winkler also notes, Apple recently lost its overall title as world's most valuable company in any field to the oil giant Exxon Mobil. It's been a difficult year for Apple in terms of share price, even though its actual performance has remained strong; some pundits have pointed to the relative lack of big product announcements this year, although big things are expected in autumn.
Related:
What's happening to Apple's share price?
Apple stock manipulation: rogue AAPL trader pleads guilty, may face 25 years in prison
Welcome to Launch Marketing Council’s new 3-part series focused on unlocking the secrets of launching brands, products and service by exploring real-life examples from Australia’s marketing elite, in conjunction with the independent agency Five by Five Global.
In early 2020, I had the pleasure of staying at the newly opened Fullerton Hotel in Sydney. It was on this trip I first became aware of the Fullerton’s commitment to brand storytelling.
If you’ve been around advertising long enough, you’ve probably seen (or written) a slide which says: “They won’t remember what you say, they’ll remember how you made them feel.” But it’s wrong. Our understanding of how emotion is used in advertising has been ill informed and poorly applied.
The launch of a new brand, or indeed a rebrand, is a transformation to be greeted with fanfare. So why is it that once the brand has launched, the brand execution phase can also be the moment at which you kill its creativity?
Algorithms that can make sense of unstructured data is the future. It's great to see experts in the field getting together to discuss AI.
Sumit Takim
In pictures: Harnessing AI for customer engagement - CMO roundtable Melbourne
Real digital transformation requires reshaping the way the business create value for customers. Achieving this requires that organization...
ravi H
10 lessons Telstra has learnt through its T22 transformation
thanks
Lillian Juliet
How Winedirect has lifted customer recency, frequency and value with a digital overhaul
Having an effective Point of Sale system implemented in your retail store can streamline the transactions and data management activities....
Sheetal Kamble
Jurlique’s move to mobile POS set to enhance customer experience
I too am regularly surprised at how little care a large swathe of consumers take over the sharing and use of their personal data. As a m...
Catherine Stenson
Have customers really changed? - Marketing edge - CMO Australia