To put this in perspective, Apple trades at 7.7× EV/FCF while
Google trades at 30.3× EV/FCF. Now, Google and Apple aren’t
exactly operating in the same businesses, and frankly, Google’s
business is “safer” than Apple’s, but this valuation gap is pretty
ridiculous and indicative of one thing: the market expects
Google’s free cash flow to grow “to da moon” and Apple’s to, at
some point, crater as a result of competitive pressures of secular
I don’t know that anyone’s business is ever “safe” in technology. And Google isn’t making nearly as much from mobile advertising as they do from desktop browsers. I think the market has this wrong.