Patent litigator Apple, despite feverish fanboi reports, has not become the most valuable company in the world, as its market capitalisation of $623.5bn is still eclipsed by that of Petrochina.

Apple’s fans regularly trot out the firm’s market capitalisation, which is the value of a single share multiplied by the number of shares available. Yesterday Apple’s stock finished at an all-time high of $665.15, resulting in a market capitalisation value of $665.15bn, which some fanbois incorrectly claimed made it the most valuable company in the world.

In present day trading and thus ignoring inflation, Apple’s marketcapitalisation doesn’t top the charts, with Petrochina, a company traded in New York, Hong Kong and Shanghai worth $722bn.

Apple’s present market capitalisation might have taken it beyond Microsoft’s 1999 value during the dot-com bubble, though that doesn’t account for inflation, which would put Microsoft ahead by a good two hundred billion or so. Accounting for inflation, it is IBM that takes the honour of having the highest historical market capitalisation, with its 1967 share price resulting in a market capitalisation – adjusted for inflation – of $1.3tn, double that of Apple.

Apple’s blinkered fanbois might like to quote its market capitalisation because it is a large, impressive-sounding number, but in reality it says very little about a company unless it is trying to find a buyer. Given that Apple isn’t for sale, the cost of buying up all the shares outstanding today is a moot point and the fact that many commentators refer to Microsoft’s dot-com inflated market value is a sign that Apple’s value is similarly inflated.

Nevertheless, as Apple is revving up to launch the Iphone 5 and with strong rumours that Apple will introduce a smaller Ipad, its stock price and market capitalisation might remain high…

Read more: The Inquirer


Leave a comment