Apple Inc. (NASDAQ:AAPL) shares are falling in premarket trades, losing about 10 percent of their value after the company released its latest earnings report. Meanwhile a report in Apple Insider says that as the market sits on shares of Apple, the company is worth a mere $299 billion, which covers all of its operations, branding and everything else that makes up the company. That translates to just $318 per share. The stock is currently trading around $514 per share.
So why does Apple Insider give such a low valuation on the company? The publication said about a third of the company’s current market value is “backed by pure cash.” Apple’s cash reserves are about $137 billion, and at this point its effective market capitalization is just $436 billion. Apple Insider takes those numbers into account in saying that the market values Apple at $299 billion.
After Apple Inc.’s (NASDAQ:AAPL) earnings report on Wednesday, there were several reports which said that the company’s earnings were flat. The company’s revenues were up, although the profits it reported were the same compared with the same quarter a year ago.
But one thing most investors aren’t taking into account is the fact that last year’s fourth quarter was a week longer than this year’s quarter. Taking this into account, Apple Insider said Apple Inc.’s (NASDAQ:AAPL) revenues actually rose 25 percent while its earnings rose 13.5 percent from the same quarter a year ago. That means the company is doing better than portrayed by some reports.