Image source: Getty Images
How did Apple (NASDAQ: AAPL) shares fare under recently-departed CEO Tim Cook? Let’s take a look at the scarcely believable numbers.
Cook took the corner office (in the figurative sense, as Apple HQ’s doughnut-shaped) of the US tech titan in 2011, succeeding co-founder Steve Jobs. On the day of his appointment, the share price stood at $13 and its market value was a mere $343bn.
Over the next 15 years, that share price surged to $324, bagging a 25x return. And the market-cap increased to $4.7trn, making Apple the second-largest company in the world (as of this month).
If you notice a discrepancy between the two figures, that’s because of share buybacks. As CEO, Cook used a sizeable chunk of Apple’s enormous cash reserves in buying back shares in the company. This pushed the share price up further than the change in market value would suggest.
All told, a £9,999 investment in Apple shares when Cook took the reins is now worth £249,205.
Now, we have a new CEO taking over – John Ternus. Same again? Another 25-bagger over the coming years?
What next?
The most striking detail about the new appointment is that Ternus is a ‘hardware guy’. This could mean a return to Apple’s innovation in physical products. Could a new CEO mean a new product line as revolutionary as the iPhone or iPad? Maybe.
That the poorly-received Vision Pro headset is reported to be on the chopping block now that he’s in charge might be a sign of things to come too. A lot of money has been spent trying to crack the ‘virtual reality’ nut. A pivot to more viable products sounds smart to me.
A buy?
Perhaps the most intriguing aspect of the company is its approach to artificial intelligence (AI). While its tech giant peers are betting the farm on data centres and massive compute, Apple’s staying on the sidelines and investing relatively little.
We’ll have to wait to see how this pans out but, in my view, it could be a masterstroke. If AI crashes, then Apple’s away from the epicentre. If AI booms, then it still has the hardware ecosystem to take advantage.
Given the current size of the firm, it’s hard to see it matching the rapid growth of the past. Whatever direction Ternus ends up taking, Apple has a humongous market value. It’s larger than every company on the FTSE 100 combined! It’s practically impossible to see 10-bagging or higher from here, in a short timeframe at least.
But as a mature company with a sticky fanbase and a dominant market position, this is still a stock that could outperform the market average, in my view. I think it’s worth considering.
What growth stock do we like better than Apple right now?
One of our Share Advisor analysts has just released a brand new stock report that we think is a must-read for any investor looking to try and generate potential growth.
And the best bit is that you can see if for yourself, right now, absolutely free of charge!
No jargon. No hard sell. Just a clear look at a growth share idea we think is worth your time.
John Fieldsend owns shares in Apple.
This story originally appeared on Motley Fool
