Is Apple Overvalued?

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 |  Includes: AAPL, ABX, AEM, AUY, BHP, CAGDF, EGO, GG, HL, IAG, KGC, OSKFF, RBIFF, RGLD
by: Tactical Investor

From top to bottom of the ladder, greed is aroused without knowing where to find ultimate foothold. Nothing can calm it, since its goal is far beyond all it can attain. Reality seems valueless by comparison with the dreams of fevered imaginations; reality is therefore abandoned. --
Emile Durkheim,1858-1917, French Sociologist

Let’s do some simple math.

There are roughly 910 million shares of Apple (NASDAQ:AAPL) in existence and the entire company has a valuation of 231 billion dollars.

To put things into perspective let’s examine the valuation of the following companies:

Stock

Valuation in billions

Comments

ABX

43

The world's largest Gold company

NEM

28

CDE

One of the world’s largest Silver producers. It has over 269 million ounces of silver in reserve.

DD

34

one of the world's chemical giants

FCX

29

One of the world's top copper producers

CCJ

9.7

One of the world's largest uranium producers

SWC

1.42

North America's largest Palladium producer

SII

10.69

One of the world's largest sellers of oil and gas services

CHK

14.5

Largest producer of natural gas in the US

VLO

11

One of the largest refiners in the US

HRB

5.6

The largest tax preparer in the US

CLF

7

A large producer of iron

ADM

17.4

One of the world's largest agricultural conglomerates

Click to enlarge

All the above companies put together would still have a valuation lower than that of AAPL. Roughly, they would have a combined valued of 214 billion. If one had to choose between buying AAPL and all the above companies, the wise choice would be to dump AAPL and jump into the above companies, especially since we are in the midst of a commodity bull. With left over change, you could purchase Hecla Mining (NYSE:HL), Kinross Gold (NYSE:KGC), Royal Gold (NASDAQ:RGLD), and you still would have some money left over.

Some other facts to consider

BHP is the largest mining company in the world and yet its valuation is well below that of AAPL; As of Monday it has a valuation of $182 billion.

You would be able to buy all the following Gold mining companies and still have a huge amount of change left.

  • Barrick Gold (NYSE:ABX) $40 billion
  • Goldcorp (NYSE:GG) $29.478 billion
  • Kinross Gold (KGC) $13.50 billion
  • Agnico-Eagle Mines Limited (NYSE:AEM) $9.84 billion
  • Eldorado Gold Corporation (NYSE:EGO) $7.95 billion
  • Yamana Gold Inc. (NYSE:AUY) $8.17 billion
  • IAMGOLD Corporation (NYSE:IAG) $6.87 billion
  • Red Back Mining Inc (OTC:RBIFF) $5.80 billion
  • Osisko Mining Corp. (OTCPK:OSKFF) $2.86 billion
  • Centerra Gold (OTCPK:CAGDF) $3.03 billion

What would you do given the choice? Buy Apple or purchase a stake in some of the top commodities-based companies in the world?