Apple Inc. (AAPL), Facebook Inc (FB) & The Story You Should Be Reading

We all know that Apple Inc. (NASDAQ:AAPL) has had a rough year on Wall Street. There is no secret there. However, Apple Inc. (NASDAQ:AAPL) cracked the top 10 in the Fortune 500 list for the first time, jumping from number 17 to number 6. This list ranks the top 500 companies in the U.S. based on annual revenues. Let’s look at some companies that made the list for the first time, and other long-time companies that either rose or fell.

The newest member of the club

Facebook Inc (NASDAQ:FB) made the list for the first time after going public in May of last year. After earning over $5 billion in 2012, the company was number 482 on the list. Interestingly, Facebook’s TTM of revenue is nearly half a billion more than the 2012 total. Like Apple, Facebook Inc (NASDAQ:FB)‘s stock has struggled over the past year. With its stock falling below $20 per share from its IPO price of $38, the stock has steadily rebounded to around $28 once again.

Mark Zuckerberg, Facebook Inc (NASDAQ:FB)‘s CEO, does distinguish himself as the youngest CEO on the list. He is just 28 years old, and his closest competitor is Marrisa Mayer from Yahoo! Inc. (NASDAQ:YHOO). She is nine years older than Mark, but they are the only two CEOs under the age of 40.

How well did tech companies do?

Not a surprise to many people, Wal-Mart was once again the top company on the list. However, what may surprise people more is that Apple was the only tech company to crack the top 10. Hewlett-Packard Company (NYSE:HPQ) was number 15, with over $120 billion in revenue. This figure is down from the 2011 totals of $127.2 billion. There is $36.1 billion separating Apple from Hewlett-Packard Company (NYSE:HPQ). Despite Apple’s stock becoming cheaper over the past several months, its 10.2% FCF yield doesn’t compare to HP’s 21.2%.

The closest tech company to Apple Inc. (NASDAQ:AAPL) wasn’t Hewlett-Packard Company (NYSE:HPQ), though. To my surprise, it was actually AT&T Inc. (NYSE:T). This phone company accrued $127.4 billion in 2012, and has seen that figure rise eight of the past 10 years. It’s revenue over the TTM is actually down to slightly under $127 billion. While Facebook and Apple Inc. (NASDAQ:AAPL) have seen revenue rise over the past TTM in comparison to 2012 totals, Hewlett-Packard joins AT&T Inc. (NYSE:T) with revenue that has fallen.

What to expect

I would expect all of these companies to increase revenues for the next several years if they can expand their mobile markets. For the first time ever, tablets are expected to outsell notebooks. By 2017, NPD expects six tablets to be sold for every one notebook. If these companies can find ways to exploit the market in a mobile way, they should do well. Apple Inc. (NASDAQ:AAPL)’s shipments of iPads increased dramatically in Q1, despite losing nearly 19% market share to competitors.

Valuation

Facebook’s FCF yield is lower than these other companies, but it is still a young company. With a FCF yield of 1.2%, the company doesn’t appear to present too much of a bargain. However, other companies present a far greater value for investors. Apple, HP, and AT&T present FCF yields of 10.2%, 21.2%, and 10.1%, respectively. In the same order, these companies earnings yields are 0.18%, 9.1%, -31%, and 3.5%. Clearly, Apple Inc. (NASDAQ:AAPL) presents the best value for bargain investors.