Apple’s Stock Losing One-Third of Its Value in Six Months – What to do Now?
March 7, 2013 Leave a comment
The big news in technology is that Apple’s stocks have lost one-third of their value in only six months. Due to this, a lot of people are pointing fingers at Apple’s CEO, Tim Cook.
Recently, Cook spoke at the Goldman Sachs technology conference to defend his company’s stock. While he didn’t march up on stage and announce that is what he was doing, it was pretty obvious to everyone around him. He explained to investors why they should continue to have faith in Apple, and talked about Apple’s superior user experience. “The only thing we’ll never do is make a crappy product,” he declared. “That’s the only religion we have: we have to do something great, bold, ambitious.”
Regardless of this, it is obvious to investors that Apple has taken a hit. No one expects them to go out of business or declare bankruptcy, but it is obvious they are struggling. The big question that comes when any company struggles is “how will they handle it?” With grace and dignity, or backlash and struggle? Henry Kravis, co-founder of the private equity firm Kohlberg Kravis Roberts & Co., shares his advice on finance: “Arrogance kills.” Unfortunately, with the iPod and iPhone putting Apple on top for so long, this is a hard lesson to learn.
The company currently has about $137bn cash on hand, at the stocks are at $475 a share, which is a still pretty good. What most people are suggesting is that they shake things up a bit. Reuters blogger Felix Salmon argued that Apple should ignore its stock price, because it says very little about the future of Apple. Bethany McLean at Reuters had a different opinion however, stating that Apple was overpriced to begin with and shouldn’t be worth more than $200 a share. After all of this information, all there is left to do is wait and see what direction Tim Cook and others decide to take Apple now.