By not defending against such cheap “analysis” that essentially evaluates the entire enterprise as worthless when factoring in cash, intermediate term securities and cash flow – Apple Inc. (NASDAQ:AAPL) is establishing low “water marks” that create a larger spread to traverse when the “sky is falling” sellers realize this is much ado about nothing.
Since the equations of their analysis really feature little more than the multiplication of negative blogs + a few charts, when the reality sets in, they may find themselves struggling just to get back to where they were a month ago instead of where the legitimate share price –should- be based upon historical multiples of earnings, assets, and future prospects.
That’s where the moves to defend and market the stock should make up for the difference. Fight the intangible negative conjecture with the potential positives within their immediate control (not hype). I don’t think Steve Jobs would have stood by to allow for this continual assault to damage the share price. Aside from splitting the shares or hiking the dividend, I believe a visionary like Jobs would be out there in the media elucidating upon the vision for the future and instilling confidence and enthusiasm. That is different than guidance on how much one believes they may achieve in sales over the next quarter or year for particular products.
Jobs was the ultimate carnival barker (in a great way) and that can make an enormous difference when a large percentage of the share price of any company is a form of “good-will.” Currently, Apple Inc. (NASDAQ:AAPL) has almost zero “good-will” left in the currently preposterous share price.
As I wrote in my Feb. 6 blog, it is rare to find an engineer like Jobs with the visionary genius and the ability to convey it so adroitly. I also wrote that Reed Hastings of Netflix, Inc. (NASDAQ:NFLX) is one of the few CEOs alive who currently embodies such traits. One need look no further than the share price of Netflix today to see how far confidence in the vision and leadership of a CEO can take the share price.
The article Tim Cook Negligent on Defending Apple’s Share Price – Price Bordering on Perverse originally appeared on Fool.com.
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