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.