A Fresh Look at AAPL Stock
For much of the last decade, I viewed Apple Inc. (NASDAQ:AAPL) as a maker of exquisitely designed consumer electronics—no more, no less. Not only was it unfair to put Apple in that box, but it also skewed my valuation of AAPL stock.
Don’t get me wrong; I understood the magnitude of what Steve Jobs did. He revolutionized the way we interact with technology within 15 years of saving Apple from insolvency. The “iPhone” was a great leap forward because it literally gave us a tiny panel to stay connected all the time.
There’s no undoing that kind of change. It was huge. But at the same time, there was nothing about it that made me consider Apple as more than a consumer electronics firm. It may have been the “best in class,” but I didn’t see growth beyond that sphere.
That is, I didn’t see it until now…
Apple CEO Tim Cook was recently featured on 60 Minutes and the exposé forced me to step back and view the company from afar. What I saw changed my opinion of Apple stock forever. (Source: “Apple CEO calls overseas tax rap ‘political crap’,” 60 Minutes, December 18, 2015.)
Tim Cook Gives AAPL Stock a Boost
Strictly speaking, Apple is still a consumer electronics firm, but the scale at which they operate deserves special consideration. For instance, the company is actively developing medical apps that can be useful to consumers, but accomplishing that task means venturing into unfamiliar territory.
Since medicine is a specialized field, you would expect investors to be turned off by that kind of expansion. After all, trying to break into a niche market is a common route to failure. But then again, Apple isn’t a regular company. (Source: “Apple’s New Health Features,” Live Science, September 9, 2015.)
The company obviously has the resources to hire whomever they choose. With more than $205 billion in cash sitting overseas, Apple can afford to invest in anything they damn well please, but that alone doesn’t mean much. Execution is important.
And that’s where the tag team of Jony Ive and Tim Cook come into play. Cook was handpicked by Steve Jobs to run Apple and he has extraordinary management skills. Plus, as the company’s ex-COO, Cook knows Apple inside and out.
Ive, meanwhile, carries on the creative legacy of Jobs. As Apple’s head of design, he is absolutely neurotic in his pursuit of artistic perfection. Sound like anyone we know? Ive’s fingerprints are on nearly everything to do with Apple, from the latest iPhone and “Apple Watch” to the sprawling new headquarters in Cupertino.