It’s amazing how much information can be presented in one simple chart.
Today we have Apple.
It’s a very good company. And has benefited from the Corona Virus. Many workers have been forced to work from home and Apple offers quality computers and IPads that fill this important need.
And yet, the shares have gone parabolic. The company has added $800B in market Cap in a few months. The market cap of the company is almost larger than the entire Russell 2000.
What we see so succinctly in this one chart is the P/E ratio (price to earnings) contrasted with the company’s growth rate. Apple now offers new investors a P/E of 33 with hardly any growth.
Caveat emptor (Buyer beware)
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Microsoft took so long to get into the phone biz to compete with Apple. Should be interesting moving forward. Apple is a very well run machine.