There's a reason why Amazon keeps going up even though they are barely profitable. Amazon keeps reinvesting their profits into the company's R&D rather than throwing it in the bank.
If you were offered $100k of Apple or $100k of Amazon right now, which would you choose? You would have to receive and hold for 10 years.
To me, the answer to that is obvious (AMZN), but I'm curious if my intuition matches up with the general opinion.
I'm not sure which would be a better sign.
ETA: Original intent was to talk about 100k in dollars, not in shares.
For example, 100k of Apple shares today will net me 265,000 USD. Assume that I decide to just pocket that money ... I could live off that for a full year, easy. They pay that every quarter (or at least that's the case at the moment). I'll make money now, be able to stick it into a savings account or re-invest it into other stocks.
If you gave me 100k in Amazon i'd be grateful, but keeping it for 10 years means that in the mean time it is useless to me. No dividends, trading at an excess that is absolutely insane, it will come crashing down eventually. Apple at least at that point has cash to continue operations, Amazon doesn't.
100k = 100,000. 100,000 * (currently) $514 = $51 million USD. You certainly could live off that for a year.
On second look, you are talking about dividends.
Also, Apple pays dividends, and they have enough cash to operate for 1-5 years on zero sales. They are better positioned (IMO) to reinvent themselves without being rushed, and at the same time minimize the potential negative impact of that reinvention to their shareholders.
As for Apple, I think they will have a harder time staying at the forefront in a very competitive market now that the iPhone and (to a lesser extent) iPad are no longer have the "wow" factor that they used to.
If Amazon grows their revenue at 40% every year (like they did in 2011) and manages a 3.5% margin (which they did for years although lower at the moment) then they will start seeing profits like AAPL's 2012 around 2021.
Meanwhile if AAPL grows at only 15% a year (and the trend is currently much higher) their numbers will have quadrupled in 10 years.
Keep those same growth rates and sometime around 2028 AMZN surpasses AAPL in annual profits; right around the time they hit $15 trillion in annual revenue.
I'm not all that confident that Apple can grow for 10 or even 15 years at any rate. There's a substantial risk that it all falls apart and we're all watching Zuck put his company logo on the new Apple headquarters when it finally opens. But the idea that Amazon has some magic profit engine that's going to appear sometime way down the road and justify their P/E ratio isn't just crazy, it's bananas. If anything they're already starting to succumb to the law of large numbers.
I think AAPL have done amazing things the past 10 years, including outstanding hardware & software, perfect marketing, and a great user experience overall. I also think that they have peaked and there is nowhere to go but down. Granted, it will take a long time to hit the bottom, but they will join the ranks of IBM & Microsoft; irrelevant and ignored.
EDITED to add: ah, I see they released earnings.