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Apple and Microsoft are the two largest companies in the S&P 500 by a wide margin. While Apple had been the undisputed king for years, Microsoft usurped it in early February 2024, claiming the crown as the stock with the largest market cap in the S&P 500. As of March 5, 2024, Microsoft comprised 7.14% of the entire S&P 500 all by itself, while Apple was close behind at 6.08%. The next nearest stock, third-place Nvidia, makes up just 4.7% of the index.
While Microsoft’s ascendance has had lots to do with its recent outperformance vs. Apple, how do the two tech giants stack up against each other over a longer time period, such as 10 years? Here’s a look at the numbers behind the names.
Apple 10-Year Performance
On March 5, 2014, Apple stock closed at a price of $16.75, adjusted for all splits. Ten years later, on March 5, 2024, Apple closed at $170.12. Patient investors who held the stock through all of its ups and downs were rewarded with what Wall Street refers to as a “10-bagger,” a stock that provided a return of 10x the original investment. On a percentage basis, those who held Apple stock over the past 10 years earned a 916% return.
Microsoft 10-Year Performance
Microsoft began the last 10 years with a stock price of $32.27, once again adjusted for all splits. With its closing price of $402.65 on March 5, 2024, it recorded an incredible gain of 1,148%. This is even more than Apple’s outsized gain of 916% and marks a more than 12x return for Microsoft investors who held the stock for the full 10 years. As impressive as Apple’s performance has been over the past decade, Microsoft’s surge helps explain why the company has at least temporarily taken away Apple’s throne atop the S&P 500 market cap leaders.
How About Since Inception?
Apple has been a public company since Dec. 12, 1980. Its IPO price that day was $22, but after adjusting for splits over the years, the effective IPO price was just 10 cents. This gives Apple an average annual return since inception of 18.87%, compared with the S&P 500’s 10.38% annual return over the same time period. That’s a pretty impressive outperformance, particularly for a company that has been public for over 43 years.
It may be hard to believe, but Microsoft’s outperformance has been even more dramatic. The company went public on March 13, 1986, at $21 per share. On a split-adjusted basis, that IPO price was effectively $0.0729 per share. Running the numbers from there shows that Microsoft has posted an average annual return of 26.18% since its inception. Meanwhile, the S&P 500 “only” returned 10.38% per year since Microsoft’s IPO date. In other words, over the last 38 years, Microsoft has, on average, trounced the S&P 500 every year by an average factor of 2 1/2 times.
Which Stock Is the Better Buy Going Forward?
Based on recent momentum, Microsoft is the best play right now. The stock is up 8.57% YTD as of March 5, and 58.43% over the past year. Analysts have an average 12-month price target of $468.70 on the stock, with a consensus “strong buy” rating. If MSFT reaches that target, that would translate to an additional 16% gain over the next year.
Apple has been a Wall Street darling for years on end now, so it’s no surprise that even with its recent pullback analysts have a consensus “strong buy” rating on that stock as well. The average 12-month price target of $205.77 suggests a 21% gain is possible in the coming year.
Which stock is best for you will depend on a combination of your investment objectives, risk tolerance and your opinion on how the stocks and companies are performing. For example, if you’re more of a consumer products investor, you might give the nod to Apple. If you’re more inclined to buy a more tech-oriented stock that’s on the cutting edge of AI, Microsoft might appeal to you more. The type of investor you are can also play a role. For example, if you favor stocks that have momentum, Microsoft might be your choice. But if you’re looking for a high-quality name that has sold off recently and has a higher 12-month potential gain according to analysts, Apple might be the call.
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FAQs
Microsoft 10-Year Performance
Is Apple a better investment than Microsoft? ›
The analyst consensus growth rate over the next five years for Apple is 11% per year, the lowest five-year growth rate of any Magnificent Seven stock. Compare that to Microsoft's consensus growth rate of 16.3% and it's clear which company is better positioned to grow in the near to mid term.
Which investment has historically had the highest returns or any 10 year period? ›
Key Takeaways
The U.S. stock market is considered to offer the highest investment returns over time. Higher returns, however, come with higher risk. Stock prices typically are more volatile than bond prices. Stock prices over shorter time periods are more volatile than stock prices over longer time periods.
What if you invested in Apple 20 years ago? ›
That means that $10,000 in AAPL stock purchased 20 years ago would be worth more than $4.85 million today, assuming reinvested dividends. The same amount invested in the S&P 500 20 years ago would be worth $51,148 today with dividends reinvested.
Which company is more successful Apple or Microsoft? ›
Both Microsoft and Apple have been trading places for the most valuable public company for years now. Microsoft surpassed Apple's market cap in 2021, 2020, and 2018 before Apple once again regained its place at the top.
Is Apple the best investment? ›
Apple has faced more than a few challenges over the last year, but I wouldn't bet against its long-term future. Its stock is trading 29 times its forward earnings, compared to Microsoft's 35 times and Amazon's 40 times. It may not be a bargain, but the figures suggest Apple could be one of the best-valued stocks in AI.
Who won the Apple vs. Microsoft lawsuit? ›
How did the court rule in the Apple vs. Microsoft copyright case? In 1992, the court ruled in favor of Microsoft. The court found that most of the GUI elements that Apple claimed were infringed upon were not protected by their copyrights.
What is the best performing asset of the last 10 years? ›
As we mentioned above, Bitcoin was the best-performing asset of the decade. The data examined the 17 top-performing assets between 2011 and 2021 and found that since 2011, Bitcoin's cumulative gains have exceeded 20,000,000%.
What was Apple worth after 10 years of its start? ›
Explanation: In 10 years Apple had grown from just thr two of us in a garage into a $2 billion company.
What if I invested in Microsoft 20 years ago? ›
Then MSFT takes off. Indeed, it took off so much that if you put a grand into Microsoft stock two decades ago, today it would be worth about $24,000. That's good for an annualized total return (price change plus dividends) of 17.2%, according to data from YCharts.
Currently, Apple has a market capitalization of $2.59 trillion. Buying $100 In AAPL: If an investor had bought $100 of AAPL stock 20 years ago, it would be worth $36,484.71 today based on a price of $167.96 for AAPL at the time of writing.
Is Microsoft a better investment than Apple? ›
While Apple had been the undisputed king for years, Microsoft usurped it in early February 2024, claiming the crown as the stock with the largest market cap in the S&P 500. As of March 5, 2024, Microsoft comprised 7.14% of the entire S&P 500 all by itself, while Apple was close behind at 6.08%.
When did Microsoft become more valuable than Apple? ›
Microsoft has briefly taken the lead over Apple as the most valuable company a handful of times since 2018, including in 2021 when concerns about COVID-driven supply chain shortages hit the iPhone maker's stock price. Currently, Wall Street is more positive on Microsoft.
When did Microsoft beat Apple? ›
This isn't the first time Microsoft has overtaken Apple as the same happened in 2018 and 2021.
Why buy Apple instead of Windows? ›
Advantages of Mac
Apple products are visually appealing, and are sometimes purchased for how they look. There are tools and apps for graphic design that are also Mac-only. Most of the big names in design software are now made for Windows, but the perception remains that Macs are what you need for graphic design.
Does Apple pay better than Microsoft? ›
Apple scored higher in 1 area: Compensation & Benefits. Microsoft scored higher in 8 areas: Overall Rating, Culture & Values, Work-life balance, Senior Management, Career Opportunities, CEO Approval, Recommend to a friend and Positive Business Outlook.
Where will AAPL be in 5 years? ›
Analysts are expecting Apple to sustain double-digit earnings growth of 11% for the next five years. Based on its fiscal 2023 earnings of $6.13 per share, its bottom line could jump to $10.33 per share in five years.
Is Apple computer better than Microsoft? ›
When it comes to value, Mac OS is the clear winner. Apple products tend to have a higher price tag than Windows but offer superior quality and performance. Mac computers also tend to last longer than Windows PCs due to their tight system integration and overall sturdiness.
