Preposterous but true: Apple's worth more than Citigroup
Posted
Apr 16 2008, 07:57 PM
by
Charley Blaine
Rating:
I'm not making this up. Apple's market capitalization is bigger than Citigroup's. The actual numbers at today's close were $135 billion for Apple and $123 billion for Citigroup.
This fact, which came courtesy of Barry Ritholtz's blog The Big Picture, struck me as, well, preposterous. Check these most basic of comparisons:
Sales: Apple's sales for its 2007 fiscal year: $24 billion. Citigroup's 2007 revenue: $147 billion.
Assets: Apple's assets at the end of its 2007 fiscal year: $25.3 billion. Citigroup's year-end 2007 assets: $2.2 trillion. Yep, trillion.
The relative values, of course, make sense, especially when we look at one more measure.
Annual profit: Apple earned $3.5 billion in fiscal 2007, which ended on Sept. 29. Citigroup earned $3.6 billion in 2007.
Profit for the most recent quarter: Apple earned $1.58 billion in its most recent quarter, which ended on Dec. 29. Citigroup lost $9.8 billion for the fourth quarter of 2007. It reports first-quarter earnings on Friday.
Citigroup is paying -- a lot -- for the subprime mortgage mess and for a bad bet that becoming the world's largest financial services company would mean ever-growing profits forever. Fact is, Citi's stock peaked at $58 in August 2000 (yes, August 2000) and is down 59% since then.
While Apple's stock was battered by the dot-com bust and bottomed in April 2003 at $6.56, it is up 2,200% since then.
But what Barry didn't put in his note was this:
This is the second time Apple's market cap has exceeded Citigroup's since December. Apple was, in fact, worth more than Citi for roughly two weeks starting in mid-December. That's when Apple's shares were in the midst of a major run that produced an intraday high of $202.96 on Dec. 27. Citigroup was, of course, sinking. On Dec. 31, Apple's market cap was about $174 billion, and Citi's was $155 billion.
Both stocks really crumbled this winter, which allowed Citigroup to take the lead back on Jan. 23 in the aftermath of Societe Generale's multi-billion loss from bad trading. Apple finished the day at $112 billion. Citi was at $138 billion. (This is really a big-whoop number. Citi's market cap was $290 billion at the end of 2006.)
Apple took the lead back from Citi again on March 13.
Three final points:
Point 1: Citi's market cap bottomed at about $98 billion when the stock hit $18.62 on March 17. It's up 25% since then. But Apple is up 29% since Feb. 26 when the stock hit $119.15, producing a market cap of just under $105 billion.
Point 2: Google's market cap, now about $143 billion, has been larger than Citigroup's every day since the end of October. And this even though Google fell nearly 45% between early November and mid-March.
Point 3: Would anybody in his right mind invest in Citi again? Maybe. The Federal Reserve did rescue Bear Stearns, and Citi would definitely be a bank that the Fed would say is too big to fail. And the recent stock chart for Citi says that, if the stock can stay above that $18.62 low, it might be a good longer-term bet.
