Apple: A Five-Year Look

  • Posted: 27 September 2002 10:47 PM

    I was doing reasearch for a response to a comment in a different forum and came across these rather interesting facts:

    Apple has outperformed the NASDAQ Composite Index since the time Steve Jobs returned to the helm as CEO:

    Apple 5-year review

    This is a five year comparison. A five and one-half year comparison (from the day Steve Jobs returned as CEO) would indicate the difference between Apple’s performance and the performance of the NASDAQ Composite Index would be even more pronounced. Apple is in the black in terms of growth in shareholder value while the investors who might have owned a portfolio that mirrored the NASDAQ Composite Index would have lost dollars.

    Since Steve Jobs returned to Apple, the company has quadrupled its cash holdings, added over one billion dollars to retained earnings and rewarded shareholders with an increase in the value of their investments that can be measured in billions of dollars.

    In contrast to Apple, Gateway, a PC company that was a larger company than Apple at the time Steve Jobs returned, has done very poorly over the same time span:

    Gateway v. Apple

    Over the same 5-year period Apple has also outperformed HP-Compaq:

    Apple v. Hewlett Packard-Compaq

    Over this five-year period the only PC company to outperform Apple in the market is Dell, a company which has recently spent more than $3 billion to buy back its own shares in order to maintain earnings per share growth. Less shares outstanding means more earnings per share.

    In looking at Apple’s long-term stock performance history,especially the span of time between the departure of Steve Jobs and his return to the helm of the company, during that time the stock mostly stayed within a narrow trading range but fell precipitously just before his return.

    What do you think this says about Steve Jobs? I think it speaks volumes about what happens to Apple when the company suffers from a lack of direction in terms of products and technology.