Apple Computer (COMP: AAPL) shares opened sharply lower today on news that Steve Jobs has submitted his resignation to Apple’s board of directors. Wow! That is a big announcement, but is it really that bad for the stock price?
The answer is nobody really knows. However, there are two main reasons why I’m not selling my shares. First, this isn’t a surprise. Over the past seven years, since Mr. Jobs was first diagnosed with a rare form of pancreatic cancer and underwent a liver transplant, he has taken three leaves of absence for medical reasons, most recently beginning last January. During these periods Chief Operating Officer, Tim Cook, has managed day-to-day operations. Based on the decline of his physical appearance I wouldn’t be surprised to find out that Mr. Job’s role in Apple’s daily operations limited throughout that period.
Second, the past seven years have been an incredibly successful period for Apple’s business and stock price. Apple’s stock has been a ten bagger since 2004 and net income is up an even greater percentage. Mr. Cook was managing Apple during much of this period – he had to have played an important role in that success!
It is clear Steve Jobs has been a huge inspiration and a driving force behind Apple’s phenomenal success, and that can’t be replaced. However, I’d bet his core philosophies and vision is so ingrained in the Apple culture that in his absence the company will maintain and continue it’s phenomenal record of success.
