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Groups > comp.os.linux.advocacy > #289446
| From | "Ezekiel" <zeke@nosuchemail.com> |
|---|---|
| Newsgroups | comp.os.linux.advocacy |
| Subject | Re: It was bound to happen sooner or later |
| Date | 2015-04-13 14:01 -0400 |
| Organization | A noiseless patient Spider |
| Message-ID | <mgh079$4d6$1@dont-email.me> (permalink) |
| References | (1 earlier) <gbvjdu03.pa3f@rooftop.invalid> <mg9lop$pmr$1@dont-email.me> <bghvur80.ra0@rooftop.invalid> <mgb69g$h0h$1@dont-email.me> <jgnvmb83.gkjd@rooftop.invalid> |
"owl" <owl@rooftop.invalid> wrote in message
news:jgnvmb83.gkjd@rooftop.invalid...
> Ezekiel <zeke@nosuchemail.com> wrote:
>
>> "owl" <owl@rooftop.invalid> wrote in message
>> news:bghvur80.ra0@rooftop.invalid...
>>> Ezekiel <zeke@nosuchemail.com> wrote:
>>>
>>>> "owl" <owl@rooftop.invalid> wrote in message
>>>> news:gbvjdu03.pa3f@rooftop.invalid...
>>>>> Ezekiel <zeke@nosuchemail.com> wrote:
>>>>>> Apple is worth twice as much as Google.
>>>>>
>>>>>> Or Google is worth 1/2 as much as Apple if you prefer.
>>>>>
>>>>>> AAPL = $740.33B
>>>>>> GOOG = $367.59B
>>>>>
>>>>>> I know many of you are confused because of "share price." But don't
>>>>>> be.
>>>>>> It's market-capitalization that determines what a company is worth.
>>>>>> Not
>>>>>> the
>>>>>> share price.
>>>>>
>>>>>> Don't be like this dimwit below.
>>>>>
>>>>>> --
>>>>>> "Share price is a measure of market confidence based on current
>>>>>> performance.
>>>>>> The market is apparently twice as confident of ($600) Google as it is
>>>>>> of
>>>>>> ($320) Apple, and 20 times more confident than it is of ($28)
>>>>>> Microsoft.
>>>>>> So
>>>>>> what Google is doing today is apparently better than what others are
>>>>>> doing."
>>>>>
>>>>>> Homer the "advocate" lecturing others on another simple concept he
>>>>>> completely fails to understand
>>>>>
>>>>> Yeah, but market cap is basically a popularity contest.
>>>
>>>> To a very small extent. There's always the "now company people want to
>>>> see
>>>> in the portfolio" thing but it's primarily based on fundamentals and
>>>> expected future earnings.
>>>
>>>
>>>>> Apple doesn't have
>>>>> all that money, and they don't get money every time a share of Apple
>>>>> stock
>>>>> is sold at a higher price. Apple got paid one time - the day the
>>>>> stock
>>>>> was
>>>>> issued.
>>>
>>>> Yes and no. When a company has their IPO they don't release all the
>>>> shares.
>>>> It's called the "float" and nearly every company owns and holds shares
>>>> in
>>>> their own company. When you hear a company is spending billions on a
>>>> "stock
>>>> buyback" then they're buying more of their own shares. Companies use
>>>> the
>>>> shares they own for bonuses, etc but they'll also sell some shares to
>>>> raise
>>>> capital.
>>>
>>>
>>>>> 2014 Liabilities & Shareholders' Equity:
>>>>> Apple: 231.84B
>>>>> Google: 131.13B
>>>>> Microsoft: 172.38B
>>>>>
>>>>> http://www.marketwatch.com/investing/stock/aapl/financials/balance-sheet
>>>>> http://www.marketwatch.com/investing/stock/goog/financials/balance-sheet
>>>>> http://www.marketwatch.com/investing/stock/msft/financials/balance-sheet
>>>>>
>>>
>>>> This is an interesting accounting trick. You see companies with insane
>>>> amounts of money in the bank yet these companies issue debt (ie -
>>>> borrow
>>>> money) to raise capital.
>>>
>>>> The reason behind this is that Apple/Microsoft/Google have the highest
>>>> possible bond ratings. So they can borrow money at a low interest rate
>>>> and
>>>> then deduct the interest from their taxes.
>>>
>>>> Most/much/shitloads of the cash they have is overseas. So if they were
>>>> to
>>>> bring that cash back into the US they would need to pay US taxes on the
>>>> money. So it's cheaper to borrow money (at low rates) than it is to
>>>> bring
>>>> in
>>>> money from foreign subsidiaries.
>>>
>>> Actually I grabbed the wrong line.
>>>
>>> Total Equity 2014:
>>> Apple: 111.55B
>>> Google: 104.5B
>>> Microsoft: 89.78B
>>>
>>> So they are really *much* closer than market cap would indicate.
>>> I mean, really, if Apple's share price fell to $1 tomorrow, based on
>>> some wild news that made everybody suddenly hate the company and dump
>>> their stock, the company would still actually be in the black to the
>>> tune of 111.55 billion
>
>> Having $111 billion in the bank isn't a bad thing. According to their
>> latest
>> SEC filing it's now up to $178 Billion.
>
>> "Apple has mind-boggling $178 billion in cash to spend"
>> (CNN-Money)
>
>
>
>>> and the shareholders could force the board
>>> to give them some moolah.
>
>> Here's where it gets tricky. For example, Google founders did a
>> power-play
>> and made it so that ordinary share-holders have no voting rights. On top
>> of
>> that, their special "class-B shares" (that don't trade on the market) get
>> 10
>> votes/share whereas ordinary class-A shares get only 1 vote per share.
>
>> The bottom line is that even if every single Google shareholder in the
>> world
>> agreed on something - they can't force the company/board to do squat.
>
>> <quote>
>> I believe this stock split is largely being done so that Sergey Brin and
>> Larry Page can maintain voting control over everyone else.
>
>> However if they don't execute well they can't be "forced" to change by
>> everyone else.
>
>> Currently everyone except Brin, Page, Eric Schmidt, Google's ex-CEO and
>> Executive Chairman, and a few other people own Class A shares. Class A
>> shares get one vote for each share.
>
>> Class B shares are largely owned by Brin, Page and Schmidt and they get
>> 10
>> votes per share. In total there were 56,167,343 Class B shares
>> outstanding
>> on January 30, 2014.
>
>> Class C shares will be given to the Class A and B shareholders but
>> receive
>> no votes on stockholder resolutions. Their trading symbol will be the
>> historical GOOG after the split. These are the shares that the company
>> will
>> probably issue going forward for acquisitions or stock awards.
>
>
>> This means that Brin and Sergey have 468 million votes compared to the
>> 280
>> million Class A shareholders, essentially complete control of the company
>> as
>> they have just over 55% of the total votes. Maybe the Board could exert
>> enough pressure on either Brin or Page to step down if they thought it
>> was
>> being taken in such a wrong direction that it warranted action but
>> otherwise
>> the founders have complete control.
>> </quote>
>> http://www.forbes.com/sites/chuckjones/2014/04/02/google-stock-split-in-larry-and-sergey-we-trust/
>
>
>
>>> Regardless of whatever is happening trade-wise on the market, a stock
>>> represents an ownership share of the company, and if the company is
>>> strong financially, that share has value separate from its market value.
>>> Likewise, whatever inflated price a stock might be selling for has no
>>> real relation to the "value" of a company.
>
>> A companies assets (like $178 billion in the bank) gets factored into the
>> companies valuation. So in Apple's case, they're a $562 billion dollar
>> company with $178 billion in the bank.
>
> All that really means though is, "this is how we're going to do the math."
> A company is truly only worth its net worth: assets - liabilities. The
> stock market is just respectable a means of gambling and has no relevance
> the value of a company. If I decide to buy Apple one day, there's no
> way I'm paying $740 billion for a company....
True, there's no way you'd ever pay $740 billion for Apple. If
(hypothetically) this were to happen then you'd be paying about $925
Billion.
Acquisitions happen all of the time. The company being bought out is usually
paid about a 25% premium. Example from just last week:
<quote>
Mylan, one of the big makers of generic drugs, made public on Wednesday an
unsolicited offer to acquire Perrigo for about $29 billion in a deal that
would extensively expand its range of product offerings.
Under the offer, announced on Wednesday, Mylan would pay $205 a share in
cash and stock for Perrigo, a 25 percent premium over Perrigo's stock price
last Friday. Mylan did not specify what the split of cash and stock would
be.
</quote>
> that has a net worth of $178 billion.
The "net worth" or what you've called book-value is going to be very low for
any company. What's the book value for Google ($367B) ... they own a bunch
of used servers? What's the book value for Visa ($161B) - they don't own
much of anything. Or a bank like Wells Fargo ($281B) where they mainly hold
money that doesn't even belong to them.
The way to look at these companies is to view them as a money-making
machine. If your neighbor offerred to sell you a "machine" that legally
produces $100k/year in cash then what would you be willing to pay for the
machine? Would you tell him to take a hike because there's only $3000 worth
of parts in this machine?
Not that this is sustainable, but I'll use Apple's last quarterly earnings
as an example:
<quote>
Apple just posted the best quarter in corporate history
Apple (AAPL) sold 74.5 million iPhones in the last three months.
That helped Apple's profit soar more than 37% to $18 billion.
</quote>
http://money.cnn.com/2015/01/27/technology/apple-iphone-earnings/
It's a money-making-machine that's currently generating a profit of $8.25
million dollars an hour, 24x7 around the clock. *That* is what gives them
their market cap.
--
"Fact is in order to "steal" something not only do you gain access to it
illegally, you deprive the original owner of their ownership"
Phil Da Lick! - The nonsense you get when "advocates" make up their own
"facts."
<u5adneKxjevjjYDMnZ2dnUVZ8iednZ2d@brightview.co.uk>
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It was bound to happen sooner or later "Ezekiel" <zeke@nosuchemail.com> - 2015-04-10 16:12 -0400
Re: It was bound to happen sooner or later Tomas <tgif9fri@numo.net> - 2015-04-10 16:15 -0400
Re: It was bound to happen sooner or later "Ezekiel" <zeke@nosuchemail.com> - 2015-04-10 16:29 -0400
Re: It was bound to happen sooner or later Tomas <tgif9fri@numo.net> - 2015-04-10 17:20 -0400
Re: It was bound to happen sooner or later Steve Carroll <fretwizzer@gmail.com> - 2015-04-10 13:33 -0700
Re: It was bound to happen sooner or later owl <owl@rooftop.invalid> - 2015-04-10 22:07 +0000
Re: It was bound to happen sooner or later "Ezekiel" <zeke@nosuchemail.com> - 2015-04-10 19:20 -0400
Re: It was bound to happen sooner or later owl <owl@rooftop.invalid> - 2015-04-11 00:19 +0000
Re: It was bound to happen sooner or later "Ezekiel" <zeke@nosuchemail.com> - 2015-04-11 09:08 -0400
Re: It was bound to happen sooner or later owl <owl@rooftop.invalid> - 2015-04-11 14:45 +0000
Re: It was bound to happen sooner or later DFS <nospam@dfs.com> - 2015-04-11 12:21 -0400
Re: It was bound to happen sooner or later owl <owl@rooftop.invalid> - 2015-04-11 16:58 +0000
Re: It was bound to happen sooner or later DFS <nospam@dfs.com> - 2015-04-11 22:00 -0400
Re: It was bound to happen sooner or later Steve Carroll <fretwizzer@gmail.com> - 2015-04-11 09:43 -0700
Re: It was bound to happen sooner or later owl <owl@rooftop.invalid> - 2015-04-11 17:17 +0000
Re: It was bound to happen sooner or later owl <owl@rooftop.invalid> - 2015-04-11 17:20 +0000
Re: It was bound to happen sooner or later Steve Carroll <fretwizzer@gmail.com> - 2015-04-11 11:58 -0700
Re: It was bound to happen sooner or later owl <owl@rooftop.invalid> - 2015-04-11 20:02 +0000
Re: It was bound to happen sooner or later Steve Carroll <fretwizzer@gmail.com> - 2015-04-11 13:56 -0700
Re: It was bound to happen sooner or later owl <owl@rooftop.invalid> - 2015-04-11 21:48 +0000
Re: It was bound to happen sooner or later "Ezekiel" <zeke@nosuchemail.com> - 2015-04-13 14:01 -0400
Re: It was bound to happen sooner or later Snit <usenet@gallopinginsanity.com> - 2015-04-13 11:21 -0700
Re: It was bound to happen sooner or later owl <owl@rooftop.invalid> - 2015-04-13 19:24 +0000
Re: It was bound to happen sooner or later "Ezekiel" <zeke@nosuchemail.com> - 2015-04-13 16:04 -0400
Re: It was bound to happen sooner or later owl <owl@rooftop.invalid> - 2015-04-13 20:35 +0000
Re: It was bound to happen sooner or later Steve Carroll <fretwizzer@gmail.com> - 2015-04-13 14:13 -0700
Re: It was bound to happen sooner or later owl <owl@rooftop.invalid> - 2015-04-13 21:52 +0000
How many barrels of oil will the stock produce ? Jeff-Relf.Me <@.> - 2015-04-13 23:42 -0700
Re: How many barrels of oil will the stock produce ? "Ezekiel" <zeke@nosuchemail.com> - 2015-04-14 13:37 -0400
How many barrels of oil will the stock produce ? Jeff-Relf.Me <@.> - 2015-04-14 10:55 -0700
Re: How many barrels of oil will the stock produce ? "Ezekiel" <zeke@nosuchemail.com> - 2015-04-14 15:20 -0400
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