Apple/Google/Amazon P/E Over Time

Was looking at this historical graph of technology price/earnings ratios over time for a talk I’m putting together, so I thought I’d share. Interesting to see Apple and Google moving valuations more or less together, and Amazon off in the stratosphere.

Apple PE Ratio Chart

Apple PE Ratio Chart by YCharts

Related posts:

  1. The Apple vs Microsoft Market Cap Game is So March of 2010
  2. Google Checkout and Amazon
  3. Amazon: The Google of Buying Stuff Thinks I’m Japanese
  4. Apple iPhone Shipments Mea Culpa Time
  5. Apple and Google Sitting in a Tree, S-p-e-w-i-n-g

Comments

  1. Ron Mitchell says:

    "Law of Large Numbers" holding AAPL back? Total bull. APPL has only a 5% share of world market, which leaves a 95% slice of the pie yet to bite into. A PEG of .5 and forward PE of less than 10 makes this the most undervalued stock on the entire market. What fools these mortals be!

  2. Capital Losses says:

    A stock is only worth what an investor is willing to pay for it. If investors feel that Amazon is a better investment than Apple, then nothing is going to change that sentiment if all things remain the same. I've heard that fundamentals, cash reserve and innovation is worth nothing for Apple, so there's very little left to drive the share price upward. Amazon has Jeff Bezos and Warren Buffett on its side. Warren Buffett understands Amazon and that's why he's backing it. He wouldn't touch Apple because no one understands Apple.

    Apple is an enigma for anyone trying to understand how a company that sells products like there's no tomorrow basically has little value beyond one hit product. I'm not sure if it's true or not, but we are seeing the results of a disrespected company who's share price has stagnated based on any number of known or unknown reasons. Many Apple bulls are sure that one day Wall Street will have an epiphany about Apple and send the shares skyward. I doubt that's very likely because the longer the winning streak continues, the sooner the end will come. Wall Street is betting on Apple to fail.

    • Steve Bryan says:

      Huh? "the longer the winning streak continues, the sooner the end will come". Isn't that like saying nobody goes to that restaurant because it is too popular and crowded? If the winning streak keeps going (actual AppleTV?) that just adds to the number of successful products: Mac laptops, iPod, iPhone, iPad, … Not to mention apps and music (OK, I mentioned it). "little value beyond one hit product"? Very mysterious. I don't think you have looked at the numbers with sufficient care.

  3. ryan says:

    Huh? Warren Buffett owns AMZN shares? Not true.

  4. Lysette Bide says:

    Looking at your graph, i was actually surprised because I always though that investors believed a lot more in Apple than Google. Apple has been doing extremely well and only fell short of expectations last quarter since 2002. They have shown constant innovation and created trust among their customers.
    Google however has had an impact for much longer than Apple and this maybe the reason why investors have more faith in it.

  5. Namazu says:

    I hope you'll explain it to the rest of us who can't make the talk. It's hard to justify a P/E of over 100, but try this thought experiment: which company is most likely to be around in 50 years? Which has the most sustainable business model and the widest moat? The price doesn't have to be "right" to be telling you something.

  6. vips says:

    I agree that Apple is undervalued where comparing PE of 13 to PE 100. Look no further than when during 2008 crash, Apple went down to near $90 while Amazon went down to $37. This is where exchange of shares reveal a lot of true value when investors scramble to to either get out completely or dump insanely over priced equity to purchase something with more value. Both are promising companies, but Apple is clearly under valued here. One reason may be because apple is viewed as a company that sells very few good personal products compared to say sony , dell, etc.. However, moving forward apple has its eye set on entering the search market along with its usual un-announced product. Apple also stole alot of android market in 2011. While nokia and others might still have majority market for basic phones, the rise in standard will force these companies to raise their bar or face death like RIMM. Its also true that if market decides to not raise PE, its will be difficult but there is no time period in history where this was sustained.

  7. netpointers says:

    I too would have thought that Apple was overvalued, and hadn't even checked its P/E.
    When I did, I was shocked to see it trading @ approx P/E 15. Remember they also have $100b in cash. I would expect their general growth to continue and dividends to start rolling within 24 months, pushing the P/E up.
    My biggest concern would be trading stocks in usd, as I fear the usd will lose value over the next years relative to EUR.