APPLE IS NOW BIGGER THAN THE ENTIRE U.S. RETAIL SECTOR….
File this one under the “check back in 10 years” folder. This is a stat that will blow your mind. Apple’s market cap is now bigger than the ENTIRE U.S. retail sector. Now, I wouldn’t short AAPL in a million years, but these are the sorts of crazy stats that make you think “hmmm, is this really sustainable?” Here’s more via CultofMac & Jim Cramer:
“Add this to your list of things Apple is worth more than. As the Zero Hedge blog notes, “A company whose value is dependent on the continued success of two key products, now has a larger market capitalization (at $542 billion), than the entire US retail sector (as defined by the S&P 500).” Nuff said.”
Cullen Roche
Mr. Roche is the Founder of Orcam Financial Group, LLC. Orcam is a financial services firm offering research, private advisory, institutional consulting and educational services.
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13 Comments
Where did we hear that before ?
Oh yes, in 1989/1990 the ground beneath the imperial palace in Tokio was (supposedly) worth more than the entire state of California.
And see what happened in 2000/2001: the internet company AOL had a market cap of some $200 billion when it merged with Time Warner, the publishing firm.
Time to go short AAPL ???
Aside from the airline industry, AOL has got to be the single most efficient destroyer of capital on the planet.
Don’t forget other classics, like Cisco being worth more than all the NA automakers. (Ironically, it became true again during the GFC!)
As far as timing a top goes, I looked at all five previous megaliths which hit $500bn market cap and the outcomes were amazingly consistent. No guarantees, but I suspect a short-term peak (at least) is *very* close.
http://jamesgoodeonthemoney.blogspot.com/2012/03/poisoned-appl.html
(To get straight to the meat, skip the first video).
Well over half of AAPL revenues are generated outside of the US so I think that while the scale of the comaparison is interesting, the comparison itself is pretty useless.
Some more food for thought, Gartner says Global PC unit sales in 2011 were around 364 million. What would AAPL trade at if it was moving 150 million ipads/year in this post-pc era?
Not that I own the stock either way.
@In Accounting: I’m pretty sure at least a plurality of US retail companies also generate large amounts of their revenue outside the US, so the comparison seems pretty reasonable.
It is an Apple madness out there. I was in a gym over the lunch – CNBC talks non-stop about Apple and how it is still not overvalued at 12 P/E and people should buy it. But best of all, – FOX news was talking about it ( right after character assassination segment on the GS guy). They were saying Apple stock is projected to be worth $700 next year and $900 in 2 years.
I give it 2 months tops to topple.
From Tulips to Apple… Nothing news.
Euphoria, anybody ?
This is silly in so many ways. First, has anyone bothered to compare margins in the retail sector with margins at Apple? Quite a bit different.
And second, the S&P Retail index is NOT the entire US retail industry! It is just a representative subset. After a quick google search, I found the list (included below). Not sure how current it is though. And I have to assume the zerohedge chart is based on this index, since no reference was provided.
And third, when I do a quick run of the numbers, I get a market cap for this index of $562B, which is actually greater than Apples. And my quick calculation didn’t include 4 or 5 companies that my quick yahoo search didn’t return a value for.
As often as I have seen this chart today, I am surprised how few people have tried to drill down into the numbers.
ALBERTSONS INC
AUTOZONE INC
BED BATH & BEYOND
BEST BUY CO.INC.
BIG LOTS, INC
CIRCUIT CITY STORES INC
COSTCO
CVS CORP
DILLARD DEPARTMENT STORES INC
DOLLAR GENERAL
FEDERATED DEPARTMENT STORES INC
FAMILY DOLLAR STORES
GAP INC
HOME DEPOT INC
JC PENNEY COMPANY INC
NORDSTROM INC
KROGER CO
KOHL’S CORP.
LOWES COMPANIES INC
LIMITED INC
MAY DEPARTMENT STORES CO
OFFICE DEPOT
RADIOSHACK CORP
SEARS ROEBUCK AND CO
SHERWIN WILLIAMS CO
STAPLES INC.
SAFEWAY STORES INC
TARGET CORP.
TIFFANY & CO
TJX COMPANIES INC
TOYS R US HOLDING CO
WALGREEN CO
WINN DIXIE STORES INC
WAL MART STORES INC
I think I’ve figured out what’s going on. S&P apparently puts some stocks in multiple sectors, so only a small portion of WMT, for example, is included in the Retail sector. Based on the SPDR ETFs, WMT only represents 1% of the Retail index, but it represents 8% of the much larger Consumer Staples index. So, yes, technically AAPL is larger than the allocated market cap of the S&P Retail Index, that index only accounts for a fraction of the total market cap of those companies.
As with anything you read on ZeroHedge, you should doubt first, investigate second, and only then come to a conclusion.
Yes- truth is such a reviled quality these days…
Sorry to disappoint folks but it is clear that many of you still underestimate just what it is that Apple is doing that makes it so successful.
It is not only two products, it is the entire spectrum of entertainment, communication and computing all moving into a mobile environment and integrated in a seamless way that few appreciate even now. And all of its competitors are off balance, reactive and four to five moves behind.
That new retina display on the latest ipad will next show up on a 15″ Macbook Air, and then on Apple TV.
Yeah…$600 may seem like a total moon shot but Apple is in the process of walking away with multiple markets. Comparing it to the size of the retail market is at best “interesting” but also “so what.”
Instead of shorting AAPL, what about going long in retail?