Trying to see Apple from a different angle: The stock market doesn’t know quite what to make of Apple

Apple “started out in the 1970s as a risk-taker and a rule-breaker, and for many members of Steve Jobs’s generation, Apple will always carry a whiff of sex, drugs and rock ’n’ roll. It retained some of that renegade aura even as it set off on a wild growth spree in the first decade of the new millennium,” Jeff Sommer writes for The New York Times.

“By last September in the annual Interbrand survey, Apple had managed to depose Coca-Cola as the most valuable brand on the planet, using criteria like popular perception and financial performance. And based on the value of its shares in the marketplace, Apple has become the biggest company in the world, worth roughly 10 percent more, in the eyes of investors, than its nearest rival, the venerable oil giant Exxon Mobil,” Sommer writes. “Yet now that Apple is so big and so successful, it poses something of a puzzle for investors. Is it a gigantic tech growth stock that will expand even more rapidly in the years ahead? Or has it turned into a high-end consumer products company, one that is, at the moment, the biggest cash cow in the world?”

“‘Basically, the market is beginning to value Apple as a consumer goods company today,” said Doug Kass, president of Seabreeze Partners Management. “It’s being valued like General Mills — a great company with great cash flow,'” Sommer writes. “And with Apple, he said, you get a share of all of its idle cash plus a kind of bonus: the possibility that the company will somehow manage to come out with another world-beating innovation.”

Read more in the full article here.


  1. Apple is the world’s leading technology company. Looking at Apple as a consumer goods company is a stupid exercise that ignores 38 years of paradigm shifting products. The raison d’être of Apple is to bring expensive, advanced technology into an affordable, easy to use form for consumers. The assumption that Apple would stop innovating new products and just pump out its existing product line ignores Apple’s 38 year track record, and it is very LAZY writing with no plausibility. Of course Apple is going to release a market redefining tech product, or two – this is as inevitable as death and taxes.

  2. On the blind side there is whore street that just doesn’t quite know what to make of Apple. Of course their chant of “Manipulators, Manipulators and Manipulators” does not help making them deaf and blind.

    On the bright side, Apple knows what to make of Apple, and of Whore street. That’s why the iBeacon at the SuperBall will be selling so many condoms.

  3. Although it’s in Apple’s favor to have the market manipulate the share price down in order to buy back more shares at a lower price, isn’t there anything Apple could do if it wanted to stop the share price being so easily manipulated? If the hedge funds are paying the news media to alter investors perceptions of Apple, why does Apple’s management allow it to happen?

    I’d heard that Apple could change the way it announces earnings and stop breaking out sales numbers. Breaking out sales numbers seems to be an easy way for the analysts and news media to find fault with the company by always choosing the weakest link to focus on. There’s no reason Apple has to leave itself wide open by issuing guidance, either. Let the analysts guess guidance since they make up their own guidance even now.

    Apple seems to allow itself to be made vulnerable to all sorts of bad press. What good is Apple’s press department if it doesn’t squash lies meant to damage the company’s reputation. These stories about Apple’s lack of innovation are really ridiculous. How could anyone say that the new Mac Pro’s thermal-core design isn’t innovative? That’s never been done by any company building desktop computers so how can anyone say innovation is completely dead at Apple?

    1. If Apple’s press office were to regularly respond to rumours, all that would happen would be that more rumours would be started as fishing exploits in order to see which ones were denied and which ones were confirmed.

      When you’re as successful and innovative as Apple, people are going to talk about you, but most of the chatter is misinformed and always will be. Apple could never win by getting involved with that game and has the wisdom to ride above it.

  4. No, I’ll put it this way, Tim Cook keeps talking about these AMAZING products, about how the ‘Blood is pumping’ at Apple.. but where are the new categories? They made a thinner iPad… and spec bumped the iPhone 5. The market should be pissed at Apple because they’re not coming through on Tim Cook’s big talk. That’s it.

    Current results are outstanding (of course), but that’s not the point, the P/E ratio reflects outlook for FUTURE earnings, not current ones. As a result, the market is saying, they don’t think Apple is doing anything interesting in the next few years, and they don’t think Apple has another iPhone-sized megahit up their sleeves.

    Prove us wrong Tim! Before October, please?!

  5. What confuses wall street about Apple is that they put the wellbeing of the company, the products they make and their employees above stockholder value, and this is confusing to wall street. How could you put more emphasis on the people who put their blood sweat and tears into a company than those who just invested some money. If more companies put their emphasis on their employees and products instead of stockholder value we might still have a viable middle class.

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