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Time Machine: Apple vs. Microsoft vs. IBM over the Last 20 Years

A decade ago, if you asked someone how they would get rich off of a time travel machine, a fairly common answer would be to go back in time and buy shares of Microsoft after its 1986 IPO.

While this is still a great answer today, the value of the software giant actually peaked back in 1999 with a market capitalization of $613 billion. Microsoft today is worth far less at only $443 billion – and after adjusting for inflation, that makes it worth around half of its peak value in 1999.

That raises the question – if we were to go back 20 years in time today, which company would be the best buy?

Stockchoker, a website that shows you the hypothetical value of stocks that you could have bought, covers this exact premise in an interactive visualization. Starting with $1,000 on January 1, 1996, the visualization shows the value of this money invested in each of Microsoft, IBM, and Apple.

Let’s start by looking at Jan 1, 2000 on the timeline, near Microsoft’s peak market cap:

IBM vs. Apple vs. Microsoft

Four years after the initial investment, Microsoft has returned an impressive 80% per year. Meanwhile, IBM is also growing fast at a clip of about 48% per annum, and Apple is working to reinvent itself as a company. Keep in mind the release of the iPod has not happened yet – that would occur to much fanfare in 2001.

IBM vs. Apple vs. Microsoft

Close to ten years later, the reinvented Apple is a success story. The iPod is flying off the shelves, and computer sales have increased dramatically. Although Microsoft still has the lead in terms of market valuation, the launch of the iPhone in 2006 would change everything.

IBM vs. Apple vs. Microsoft

Finally, we’ve reached mid-2015. Apple is now primarily in competition with Google (which IPO’d in 2004) for the most valuable company in the world. The $1,000 invested in Apple in 1996 is now worth a hefty $117,413 for a return of over 100x.

Want to travel back in time and watch this for yourself? Visit the interactive visualization by clicking here.

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