Apple’s stock price currently hovers in the low $520’s, a far cry from the days of AAPL closing just over $700. Where Apple’s stock price may be headed is up for huge debate, and if you want to believe AAPL is moving to $800, then believe this. If you want to believe Apple is in a free-fall, go here. There seems to be an abundance of Kool-Aid for everyone of any persuasion. Underneath all of the pop culture of stock predictions lies a fundamental question: Did investors ever believe in Apple, or was it only Steve Jobs that they saw someone worth investing in?
Steve Jobs led Apple out of its dark past to make Apple the largest financially solvent tech company in the world. Investors were quick to take note and eagerly followed along. AAPL rose from $10 a share in 2004 to over $350 per share by the time of Jobs death in March, 2011, rising to over $420 a share (which included two stock splits). Apple’s stock price continued to march happily north, peaking at $702.10 on September 19, 2012, nearly a year after Tim Cook had begun to act as full-time Apple CEO. Nothing had seemed to change between Jobs or Cook, just more product market share and financial success. But it wasn’t long after Apple’s dramatic rise to just over $700 that Wall Street began to sour on Apple.
Since the fall of 2012, AAPL has seen a low of $392, with a high only reaching back to only $570. Some argue this is higher than Jobs ever achieved while at the helm of Apple, but Apple’s cash reserves alone, a staggering $160 billion, demand a stock value of at least $500 a share.
Apple’s valuation is out of whack with that of its tech competitors, and no matter which analyst estimate Apple beats or misses, there has been little to no effect in moving the stock in a positive direction for quite some time.
Apple’s revenue growth has come to a literal standstill, and investors seem more inclined to look at AAPL as a mature dividend stock versus any growth vehicle for the future.
When Apple’s stock began to be shaken, questions of Cook's leadership swiftly came pouring down. Since Cook’s reign of CEO at Apple, the company has not produced a single new revolutionary market segment product. iMac, iPod, iPhone and iPad were all under Jobs leadership. Mr. Cook has only managed Jobs products, has showcased nothing to show his own leadership prowess, and has given investors little reason to invest.
Perhaps Wall Street never invested in Apple? Perhaps they invested in the charismatic Steve Jobs and his ability to turn markets upside down, or create new ones out of thin air. With Tim Cook running Apple, Inc. the story has been much different. The most anticipated product coming from Cupertino is a near-release larger display iPhone 6 — hardly a revolutionary solution for a market that has had large display phones for years. Perhaps a highly anticipated watch device or revolutionary TV solution will allow investors to open their wallets once more and buy into Apple’s vision, the Tim Cook version.
Did Wall Street ever believe in Apple, Inc? Apparently not, but they did believe in the man leading it for over a decade and Steve Jobs is no longer with us. Recent history shows us that any big run up in Apple’s stock price is over, no matter how much cash Apple accumulates, or how high dividends go, it was apparently about Jobs – not Apple.
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