EV = market cap
+ (debt + minority interest + preferred shares)
- (total cash and cash equivalents).
It's that last bit that pushed Google (with $58 billion in net cash on the books) past Apple ($141 billion).
Of course, it's unlikely that anyone is about take over either company. And as Eassa points out in Apple: This Is Ridiculous, "there is absolutely no contest as to who the real 'boss' is" in terms of generating cash. (See chart.)
"I think this valuation gap is, frankly, absurd and worth exploiting," he concludes. "I'm starting to believe that Google has run far ahead of itself and -- despite how much I absolutely adore Google -- think that the pair trade here is probably to short Google/buy Apple until Apple's enterprise value is, once again, squarely ahead of Google's."
His advice, not mine.
Apple is more valuable than Google by every measure except sentiment on the Street.
FORTUNE -- In June Rolfe Winkler, writing for the Wall Street Journal's MarketBeat blog, posted an item called Big Apple, Bigger Google.
By Winkler's calculations, Google's (GOOG) value had just surpassed Apple's (AAPL). Not in market capitalization, mind you, (i.e., share price times number of outstanding shares), which is the way these thing are usually measured, but in MOREPhilip Elmer-DeWitt - Aug 12, 2013 6:35 AM ET
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