Apple vs. Microsoft: A tech rivalry revisited

The iPhone maker is now the most valuable public company in history, breaking a record for market cap that the software giant set in 1999.

By The Fiscal Times Aug 21, 2012 5:30PM
David Paul Morris/Bloomberg via Getty ImagesBy Yuval Rosenberg

Hey, Microsoft (MSFT), how do you like them Apples (AAPL)?

With its stock ending the day up 2.63% to $665.15, Apple on Monday became the most valuable public company in history, breaking a record for market capitalization that Microsoft had set in December 1999.

In the late 1990s, as technology and Internet stocks were flying high, Microsoft catapulted past behemoths Coca-Cola (KO) and General Electric (GE) (the previous No. 1) to become the world's most valuable company, eventually becoming the first to top $500 billion in market cap. On Dec. 27, 1999, Microsoft ended the trading day with a valuation of $616.34 billion. It would go on to reach an intra-day peak valuation of $620.58 billion on Dec. 30 of that year.

On Monday, with rumors still flying about the expected announcement of the iPhone 5 and other new products next month, Apple blew past those records as its stock reached a new all-time high. As the stock zoomed 64% higher this year, Apple's valuation passed the $400 billion, $500 billion and $600 billion milestones. It is now worth $623.52 billion. The second-largest company, Exxon Mobil (XOM), is valued at $405.97 billion, meaning Apple is worth almost 54% more than the oil giant.

Microsoft, meanwhile, ended Monday with a market cap of $257.71 billion, more than $360 billion below its 1999 peak. (It has shown signs of its own resurgence, with shares up 18.41% since the start of 2012 and 27.82% over the past 12 months.)

Standard & Poor's analyst Howard Silverblatt noted that Microsoft may still have a claim to the all-time title, though. "While I have not done a full back test, it would appear that on an inflation-adjusted basis Microsoft still holds the lead, with Apple needing to cross the $900 per share mark to beat it," Silverblatt wrote in an email. Adjusted for inflation, Microsoft's 1999 peak would roughly equal $853 billion today.
Apple vs. Microsoft stock

One other note on the record: The Associated Press reports that "PetroChina (PTR) was briefly worth $1 trillion after it listed on the Shanghai stock exchange in 2007, but only based on its price on that exchange, which is isolated from the rest of the financial world because of Chinese laws on foreign investment. PetroChina's shares also trade in Hong Kong and on the New York Stock Exchange. Based on prices there, its market capitalization never went as high as $500 billion."

But Apple could put aside any such quibbles before long, at least according to some Wall Street forecasts. Last week, Jefferies analyst Peter Misek boosted his price target from $800 to $900 a share, predicting that the iPhone 5 could be "the biggest handset launch in history" and that Apple has a new TV product "in full production." Earlier this year, Brian White of Topeka Capital markets slapped a $1,001 price target on Apple stock, and Piper Jaffray analyst Gene Munster seconded the idea that Apple could reach that mark by 2014.

Whether or not it gets there, Apple shareholders have had an insanely great ride. Just look at the stock's 10-year chart above. That orange line near the bottom, by the way, is Microsoft's stock.

(Microsoft publishes Top Stocks, an MSN Money site.)

Yuval Rosenberg is a Business and Economy Editor at The Fiscal Times. Subscribe to The Fiscal Times' free newsletter.

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2Comments
Aug 21, 2012 7:14PM
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Apple's all about consumers electronic toys and Microsoft owns client and enterprise server software.  You're comparing Apple's gadgets to Microsoft's information technology is like comparing Batman to Jeremiah Johnson. Little rich boy running around in his underwear would get eaten by any grizzly. Microsoft's real competition is Google's Android. Apple's just a passing consumer fad like crocs.
Aug 21, 2012 7:06PM
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Sure, if the idiots at MSN say it's going to go up, I'm sure it will. I will simply continue to DRIVE LESS until they (the oil companies) decide to stop their thieving, greedy ways.

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