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Is Apple's New $68 Million Retail Maven Worth It?

Although the company as a whole finally seems alive again in the wake of its blowout earnings report, not all of tech giant Apple's (NASDAQ: AAPL  ) businesses are shooting the lights out.

Case in point: Apple's retail operations have slowly decelerated over the past several quarters. In fact, in its most recent report, Apple's retail sales remained flat compared with the same quarter last year. Clearly, something has to change.

Source: Apple.

And change it shall. Apple recently installed former Burberry CEO Angela Ahrendts to breathe new life into its stagnating retail operation, while also handsomely rewarding her for her services.

But is she worth it?

Amazing Angela
Few question Ahrendts' track record. At the helm of Burberry, she worked wonders on overall sales by savvily tapping into several key trends that fit beautifully with Apple's long-term growth strategy. However, in an age where plenty of other retail names have moved quickly to parrot Apple's in-store strategy, Ahrendts is probably in for the challenge of her career in returning the magic to Apple's retail business.

So, with a $68 million dilutive price tag and so much uncertainty, did Apple investors get a good deal?

In the following video, tech and telecom specialist Andrew Tonner argues that really only time can tell whether this already-expensive hire will bear further fruit for Apple and its shareholders.

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Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On May 10, 2014, at 9:35 PM, GaryDMN wrote:

    I'm surprised the author does not understand stock options. They are worth nothing, if the stock price does not go up. She is not being paid $68 million, she has the right (option) to buy Apple stock at the current strike price at the time the options are granted. I assume the $68 million is the amount of shares in the option. If the stock goes up, she basically pays $68 million to buy the shares, if they are worth more than that, she makes the difference. If the stock does not go up, she has no obligation to buy the shares.

    I would assume shareholders would like to see the stock go up, so it is a win-win if her efforts pay off, if not it does not effect stockholders.

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Andrew Tonner

Andrew Tonner is a tech specialist for The Motley Fool. He is a graduate of The University of Arizona with a degree in Finance.

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