“Fourteen billion dollars. For some countries, that exceeds the annual GDP, dwarfing the value of all goods and services produced over the course of an entire year,” Marcus Wohlsen writes for Wired. “This is part of a larger repurchasing plan meant to shore up its share price and show investors it’s actually doing something with the nearly $160 billion in cash parked in its bank account.”
“But what investors really want is something new,” Wohlsen writes. “Apple’s share price has dropped in part because of ongoing concerns that its innovation engine is sputtering. After birthing new product categories with the iPod, iPhone, and iPad, Apple has gone several years without creating something truly original.”
MacDailyNews Take:
• iPhone was released 5 years, 7 months, and 19 days after iPod.
• iPad was released 2 years, 9 months, and 5 days after iPhone.
• Tim Cook has been Apple CEO for 2 years, 5 months, and 18 days.
“But what if, instead of struggling to invent its way to its next big thing, Apple simply bought it?” Wohlsen wonders, “If you’re reading, Tim Cook, we have a few suggestions.”
Wired‘s 10 companies Apple could acquire instead of buying back all that stock:
• Tesla
• Dropbox
• Uber
• Square
• Jawbone
• GoPro
• SpaceX
• FedEx
• Target
• Luxembourg
Read more in the full article here.
[Thanks to MacDailyNews Reader “Fred Mertz” for the heads up.]
Compared against that list, Apple is definitely the best bet. Well, maybe Luxembourg.
Imagine Luxembourg with all glass and steel circular buildings!
It is articles like this that put into question the relevance of a once great “magazine”. I swear they are just looking to fill space and do not vet the content of what their freelance contributors write. What crap.
Apple under Steve Jobs – zero stock buybacks, zero dividends. Stock shoots up to the moon.
Apple under Tim Cook – $100 billion stock buybacks & dividend payments. Stock drops like a rock to the bottom of the ocean and stays sleeping with the Titanic’s rusting hull.
Tim Cook: “Winning!” Charlie Sheen: “Winning!” Tim Cook = Charlie Sheen. Maybe Cook should start drinking dragon’s blood.
A few months before Jobs died, Apple briefly emerged as the most valuable company in the world, based on market capitalisation. Some time AFTER his death, it reclaimed this position and surged significantly higher. In those two years, it has remained the most valuable company for almost the entire period (except that short dip below $400, when it traded top spot with Exxon-Mobile for a short while).
When a stock is somewhere in the bottom half of the top 100 companies by market capitalisation, and the company is growing its business, investors can easily see the room for growth. However, if it is the most valuable stock in the world, it is practically impossible to convince investors that it is actually a growth stock.
This is the essence of AAPL’s problem: regardless of its business growth, too many investors out there look at its stock market position (bigger than Exxon-Mobile, Berkshire-Hathaway, GE, Microsoft, Google…) and think that it is simply impossible for a computer company to grow that rapidly.
Google will likely get into the same position very soon, having eclipsed Exxon-Mobile to take the No. 2 spot.
Eventually, the P/E ratio will drop down to ridiculously low numbers (at this point, same as BRK.A, Wal-Mart, JPM Chase, MSFT and similar non-growth companies) that there will have to be some upwards adjustment.
Essentially, when you are the biggest, people have a hard time accepting the possibility that you can still grow.
Go and buy a PC you asswipe.
…or it could buy a couple aircraft carrier fleets and all the buildings and equipment of the US army in korea and ship our boys back home.
I repeat, again: Just buy Disney.
Agreed. 10x strategic synergy vs. any of the ideas from Wired, though I like Luxembourg.
Yeah buy Luxembourg. Move head quarts there, and kill many birds with one stone.
/s
Yes ! Tesla and Sony as well…
Totally not part of Apple’s business model, but owning SpaceX would be pretty cool.
Maybe I’m missing something here but today’s MacNews Daily Take “• iPhone was released 5 years, 7 months, and 19 days after iPod.
• iPad was released 2 years, 9 months, and 5 days after iPhone.
• Tim Cook has been Apple CEO for 2 years, 5 months, and 18 days.” in response to “After birthing new product categories with the iPod, iPhone, and iPad, Apple has gone several years without creating something truly original.” makes no sense.. Not one of the 3 points mentioned affect the point of the quote. The first 2 just tell you when each product came out relative to a previous product telling us nothing about how long from NOW that those products were released and the 3rd was not something original created by Apple.