Apple represents 4% of the S&P 500. Again

Microsoft, GE, Exxon and Cisco have also been to the 4% Club. This is Apple’s 4th visit.

From Phil Segner at the Leuthold Group ($) via Barron’s ($):

Even though [Apple’s] last three admittances lasted only one month each, no other previous 4% Club firm was able to revisit the magic threshold after falling out. Apple continues to outrun the grim reaper of capitalism with unprecedented vigor.

My take: Stop that metaphor!


  1. John Blackburn said:
    That chart doesn’t include dates, but if it did it would reveal those previous peaks as white-hot valuations, unmoored from fundamentals, which soon plummeted back to reality.

    For the comparison to be meaningful, you’d have to determine whether Apple has achieved that valuation while remaining solidly grounded.

    August 4, 2018
    • Mark Visnic said:
      Absolutely correct John. Apple reached $1,000,000,000,000+ 🙂 market cap the old-fashioned way: solid business metrics. The proof is in the cash flow multiple ex-cash. No other company attaining premier market cap heights is close to comparable on that supremely important metric. No other pretender to largest market cap in the world could support its valuation for long because the valuation was driven by extrinsic factors that were ephemeral.

      August 4, 2018
    • Michael Thompson said:
      Cisco was trading at 90x earnings when it achieved its peak valuation.

      Apple trades at 13-15X FY 2019 earnings (analyst projections for 2019 are way too low) and far less when deducting cash.

      We are going MUCH higher. It’s possible that the dam has broken regarding Apple and its ridiculously low valuation. We’ll know soon enough.

      August 5, 2018
  2. Given how low WS values Apple/AAPL my initial reaction to John’s statement would that AAPL hit 4% on the strength of long term fundamentals, and not short lived spurts of revenue growth.

    August 4, 2018
    • David Drinkwater said:
      Yes. I think the implication was silently understated.

      August 4, 2018

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