[laut]

Apple is very profitable. It made 3 billion last quarter, about twice Jet Blue's market cap. Apple has no debt and a lot of cash. Apple could essentially buy Starbucks with cash. Apple's current assets is more than 30B and Starbucks market cap is less than 20B.

[alanthonyc]

I'm not saying that Apple isn't overvalued, but let's get some perspective here:

With $40 billion in the bank, Apple could buy, in cash, today, all of the following:

  - New York Times (1.4 billion)
  - Jet Blue (1.6)
  - Burger King (2.8)
  - Dreamworks (3.4)
  - Abercrombie and Fitch (3.9)
  - NStar (3.9)
  - Chipotle (4.2)
  - Netflix (5.1)
  - H&R Block (6)
  - Whole Foods (6.8)

Now, assuming the 3 billion dollars someone else here said they made last quarter is accurate. And assuming it holds true for a few years:

  - they can buy Dupont by November.
  - they can buy CBS by June 2011
  - they can buy Hershey by April 2012
  - they can buy Estee Lauder by April 2013
  - they can buy Starbucks by November 2014
  - etc. Kellogs and Newmont would take about twenty months each.

Keep in mind that this is all straight cash. A lot of companies operate in debt, Apple doesn't have any and wouldn't have to take any on to do these hypothetical purchases.

And naturally, this is all based on what they are doing today. If you put your money into the stock, you're assuming they are going to do at least as well. But even if they don't, that's still a lot of money the company is generating.