Fun with Hollywood hypotheticals.
From Chris Katje’s”How Much Forrest Gump’s Theoretical Stake In Apple Would Be Worth Today” posted Sunday on Benzinga:
In a scene towards the end of “Forrest Gump,” the titular character says that his friend and business partner Lieutenant Dan took care of their Bubba Gump shrimp money.
“He got me invested in some kind of fruit company,” Gump says, showing a letter with the old Apple Computer logo.
The movie timeline would follow the investment being made in Apple after Hurricane Carmen in 1974 and was likely a hypothetical $100,000 stake for 3% of the company. Apple went public in 1980 after raising money from venture capitalists and angel investors.
“I got a call from him saying we didn’t have to worry about money anymore,” said Gump…
Lieutenant Dan was certainly right that Gump would not have to worry about money anymore if they bought 3% of Apple.
The hypothetical 3% stake in Apple would be valued at $73.29 billion, based on a market cap of $2.44 trillion.
My take: Woulda coulda shoulda.
Shrewd investing advice.
Additionally, did he factor in dividend reinvestments over the years? I checked my daughter’s July 1997 $3,500 Apple investment just now and at Closed Friday, her Apple holdings were: $5,325,709.44. No shares ever have been sold and all dividends reinvested.
I am not a mathematician but I know a little about investing. The larger the base, the more the investment balloons exponentially. The article uses a $1,000 investment in Apple stock the day “Forrest Gump” was released as now being worth $610,000.49 based on a share price of $146.40 for Apple. So, a $3,500 investment base means a 3 ½ times more exponential growth as shares over the decades, split. That exponential growth is the only answer that I see for the differential over the years in the hypothetical $1,000 investment and my daughter’s $3,500 investment.
Over the years I long have emphasized why owning and “holding” even a few shares of Apple puts you way ahead. And why owning and buying right now is still a very, very smart move.
As they say on Saturday’s down in Baton Rouge: “Geaux Jerry!”
What a stupendous outcome from such a bashful beginning.
Geaux, geaux .