2 To Watch: Apple Mixes it up, BlackBerry Talks Straight

Apple names a new CFO; BlackBerry CEO gives investors the odds.

Mar 5, 2014 at 10:15AM
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Hiring was slower than expected in February, according to payroll processor ADP, with just 139,000 payroll additions against the 155,000 median forecast in a Bloomberg survey of economists. As Federal Reserve chief Janet Yellen rightly emphasized before a Senate panel last week, the critical question is to what degree weak economic data is due to the rough U.S. winter versus economic factors. The Labor Department will release its February employment report on Friday; the consensus estimates call for 150,000 job additions and a 6.6% unemployment rate, which would be unchanged.

Stocks opened roughly unchanged this morning, with the benchmark S&P 500 and the narrower Dow Jones Industrial Average (DJINDICES:^DJI) up 0.01% and down 0.10%, respectively, at 10:15 a.m. EST. Two technology stocks are making headlines this morning: The world's most valuable company, Apple (NASDAQ:AAPL) yesterday appointed a new chief financial officer for the first time in a decade; meanwhile, BlackBerry (NASDAQ:BBRY) CEO John Chen is offering straight talk to investors.

Veteran Apple CFO Peter Oppenheimer will be replaced by Italian-born Luca Maestri, who joined the company a year ago as controller. For The Wall Street Journal, the appointment of a non-US national is not coincidental:

[Maestri came to Apple after] a two-year stint as the CFO of Xerox. He also boasts a long career of deep international experience at companies such as Nokia, Siemens and the overseas divisions of General Motors. Apple took pains to emphasize both Mr. Maestri's overseas resume and the "seamless" nature of the transition, and it is noteworthy that the company chose to handpick an outsider rather than promote from within. ... It is no surprise that the company is beefing up the foreign ranks of its workforce and its executive suite in an effort to capitalize on markets with better growth potential.

The Financial Times, on the other hand, reads another signal in the hiring choice, headlining its article, "Apple's Maestri appointment raises hope of more share buybacks":

In March 2012, Mr Oppenheimer oversaw Apple's $100bn share repurchase and dividend scheme, but Ben Reitzes, analyst at Barclays, has expressed hope that Mr Maestri could increase that further. Mr Reitzes said that Mr Maestri was "likely to favour buybacks", even as Apple prepares for new product launches this year...

Both of these orientations ought to please investors. Last week, Apple CEO Tim Cook said the company would provide an update on the company's capital return program "within the next 60 days."

And speaking of what the CEO said: BlackBerry's Chen told the Financial Times that there was a "50/50 chance" his turnaround strategy for the ailing device maker would fail. If you're a BlackBerry investor (or prospective investor), you really ought to ponder the significance of those odds. Are you prepared to bet on a coin toss and what is your downside if that coin doesn't come up your way? Right now, John Chen is working hard to shore up the company's remaining value, but, if he fails, the downside is substantial.

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Alex Dumortier, CFA has no position in any stocks mentioned. The Motley Fool recommends Apple. The Motley Fool owns shares of Apple. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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