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Iconic Apple Tough Act to Follow
Posted by: Muhammad Bazil (IP Logged)
Date: October 11, 2012 10:55AM
A funny thing happened on the way to the iPhone 5. With the specter of Steve Jobs still roaming the company’s halls, Apple (AAPL) has exploded to become the largest company ever on the United States stock market. With a market capitalization of $629.4 billion, even technology competitor Google (GOOG) lags behind with a market cap of $251.97 billion. Apple found itself breathing that rarefied air in August of 2012 slipping quietly past giant Microsoft (MSFT) with barely a whisper. The technologically innovative company follows in the footsteps of several other iconic corporations such as Microsoft, the harbinger of the personal computer, and International Business Machines (IBM) whose concepts and ideas have changed the way we live.
Apple’s phenomenal success comes even with the untimely death of founder and technology genius Steve Jobs a year ago. Jobs was Apple’s chief visionary and analysts wonder how long the company can maintain its meteoric ride without him. Insiders say that Jobs, who knew he was dying, had planned ahead for his company and it is to his credit that Apple has continued its growth beyond expectations. Jobs also had the foresight to surround himself with the brightest and the best. After he was fired from Apple in 1985, the company struggled for 10 years. Jobs struggled also but went on to found another computer company called NeXT, following which he founded Pixar Animation Studios. In 1996 Apple acquired NeXT and with it Jobs landed back at the company he had started, a much wiser and better businessman. In 1997 Jobs became CEO of Apple and the company began its phenomenal rise, never looking back. Jobs is the father of the iPod, the iPhone and the iPad, and, more than likely, any other innovation that Apple launches for at least the next five years. Jobs is still controlling the creative aspects of his company, even in death.
The question now is where Apple goes from here. Investors who were worried about the company’s prospects without Jobs at the helm have been pleasantly surprised over the past year. Apple stock has grown a respectable 64 percent this year with Tim Cook as the new CEO. Cook spent time at Compaq prior to being lured to Apple by Steve Jobs in 1998. Cook had been acting CEO of Apple at least three times while Jobs was battling pancreatic cancer and receiving a liver transplant. Jobs resigned his position due to illness in August of 2011and Cook was named new CEO. Cook carried on with Jobs’ vision for the company lending stability and a smooth transition. Confidence rose further after Apple won $1 billion patent infringement lawsuit against Samsung (SSNLF), the world’s largest maker of smartphones. Apple’s contention that Samsung had stolen smartphone technology was upheld by a federal jury in San Jose California, in August of 2012. Samsung will of course appeal the decision but the message has been sent loud and clear. Apple will fight any smartphone producer who infringes on what the company considers its intellectual property.
The bottom line is that no company stays on top forever. It will be interesting to see how Apple handles the challenges that are sure to come from other companies, large and small. Even as this is written there is more than one small company hoping to become the next Apple by developing smarter, better technology that will appeal to the mass market. And then there are the threats from larger companies such as Google with its Android operating system. Google’s acquisition of Motorola Mobility puts it in the smartphone handset business for the first time. Google also has exceeded Microsoft’s market cap for the first time in company history. But no matter how many companies step up to the challenge, it is unlikely that Apple will lose market share anytime soon. At the close of market on Oct. 5, 2012 stock was selling for a healthy $652.59 a share. In the end, the shareholders are happy, the analysts are bullish and the outlook is for continued monetary success, even with the small setbacks that Apple has had this past year, one of them being the failure to produce a viable mapping application which caused the company to issue a public apology. Consumers seem willing to forgive and sales are up on the iPhone 5. Right now it is Apple’s market to lose.