Apple – How can share prices sink when one man gets i-sick ?

Which Employee Share Ownership Plan is right for your business? Watch our Free Webinar 

Apple – How can share prices sink when one man gets i-sick ?

Blog

Apple – How can share prices sink when one man gets i-sick ?

By , November 5, 2011

When you look at Apple you see a highly successful, creative business, generating shareholder returns far superior to its major competitors – for example in terms of total shareholder returns Apple outperforms both Google and Microsoft by over 50 % and has done for many years. But, despite being a massive enterprise with a market capitalisation of just on $279 Billion, the share price gets the i-wobbles everytime its CEO Steve Jobs gets sick – surely a business this size cannot be so dependent upon one individual ?
We often assess risk in SME clients in terms of key person dependence and put strategies in place to reduce that risk ( and its effect on the valuation of the business ) but it seems Apple has been unable to resolve the issue completely ( at least to the satisfaction of the wider market ).
In AFRBoss , Emma Connors recently wrote ” Steve Jobs may well be one in a billion, but he is not immortal. The company’s share price has got the wobbles more than once when investors have become concerned about his health and the lack of a successor ( Jobs had a liver transplant in mid 2009 ) .”
Former Apple executive Steve Vamos ( now on the board of Telstra ) says “Today, Steve Jobs is Apple, the big question is whether Apple will be able to carry on without him “

Craig West

Craig West

Managing Director | Succession Plus

Craig West is a strategic accountant who has over 20 years’ experience advising business owners. His background as a CPA in public practice, provided invaluable experience in the key issues of concern to business owners. Following 6 years of study to gain two masters degrees, Craig focused on Capital Gains Tax (CGT) for business sales advising on strategic management of tax issues. This experience formed a very strong view that business owners (and often their advisers) were unprepared and unaware of the steps required to prepare a business for exit.

Craig now acts as a strategic mentor for mid-market business owners and has written four critically acclaimed books on employee incentives, succession planning, asset protection and exit strategies. Craig has conducted numerous seminars and keynote presentations throughout Australia & internationally, including adviser education programs for the Institute of Chartered Accountants and CPA Australia.

Interested in retaining your key employees?
Get your free ESOP whitepaper.


This field is for validation purposes and should be left unchanged.