Apple 2.0

Covering the business that Steve Jobs built

Ten charts: Why Wall Street loves Amazon and hates Apple

July 29, 2013: 5:08 AM ET

Apple posted record quarterly sales and got a one-day bounce in the stock market. Amazon posted its third quarterly loss in a row and hit an all-time record high.

chart_ws_stock_appleinc_201372934043_240xaFORTUNE -- In November, the last time we compared Apple's (AAPL) and Amazon's (AMZN) price-to-earnings ratios -- the simplest and most widely used metric to gauge the relative  value of a pair of stocks --  Apple's trailing PE was 13 and Amazon's was 2,767.

We haven't been able to repeat the exercise because while Apple PE has drifted with its stock price to between 10 and 11, Amazon's trailing PE has reached, as Buzz Lightyear might put it, infinity and beyond. (Or, as the stock charts politely have it, NA.)

That's because Amazon, which reported its June earnings on Friday, hasn't turned a profit for three quarters in a row -- a performance that Wall Street rewarded by pushing its stock to an all-time-high of $312.01.

It will come as no surprise to readers here that Apple, which posted record fiscal Q3 sales (but lower earnings) three days earlier, couldn't catch more than a one-day break on the stock market.

That's because as far as Wall Street is concerned, Apple and Amazon are in completely different businesses. As a regular on Investor Village's AAPL Sanity board who calls himself "djt" put it last week:

"The Street sees Amazon as the world's biggest (online) global retailer with almost limitless growth. [It] sees Apple as a (mobile) device maker that because it is wholly dependent on its ability to innovate nonstop, expand its (ultimately saturated) markets while fighting off competition and controlling its very unstable supply chain, has limited growth."

To underscore just how much Wall Street loves Amazon and hates Apple, the reader who posts as "Merckel" has submitted for your consideration nine bar graphs and a five-year sales chart:

Screen Shot 2013-07-28 at 11.33.22 AM

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About This Author
Philip Elmer-Dewitt
Philip Elmer-DeWitt
Editor, Apple 2.0, Fortune

Philip Elmer-DeWitt has been following Apple since 1982, first for Time Magazine, and now on the Web for Fortune.com.

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