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Apple: After Jobs, Is It Still a Buy?

Eric Bleeker
August 25, 2011

The panic has begun. Steve Jobs is gone from Apple (Nasdaq: AAPL  ) , and shares are collapsing. Or, wait a minute. As of this writing, shares are down 1.2%, which is actually less than the 1.5% fall the Nasdaq has seen.

The greatest CEO of our generation steps down, and Apple just keeps on rolling. Mere years ago, that would have been an unfathomable thought.

But is that the right reaction? I asked a panel of Foolish experts to pull out their crystal balls and look into Apple's future.

Fool contributor and Rule Breakers analyst Rick Munarriz
Throw me into the "I can't believe Apple is trading for less than 12 times next year's earnings" camp, but I'm also a realist. It will not be business as usual for the class of Cupertino without Steve Jobs around.

Who will rally the troops at the next Apple powwow when a pressed black turtleneck occupies a display case at the Smithsonian?

I believe in Cook as an operational guru, and perhaps even a visionary, but Apple will be several degrees less intense in the charisma department. You can't simply flip the autopilot switch and let Apple coast through the next few years. Apple will have to sell mainstream audiences on its future. That's where Jobs will be sorely missed.

Google's (Nasdaq: GOOG  ) Android is kicking the iPhone's tail, padding its market-share lead. Now that handset makers, carriers, and developers have a "free" platform that's actually resonating with smartphone buyers, Apple will have to work harder. Google is willing to spend $12.5 billion on Motorola Mobility (NYSE: MMI  ) to protect this "free" operating system, so it's not going to back down.

Sure, the iPad is the only tablet that's selling, but I can't imagine anyone other than Jobs brainwashing us into thinking we actually needed one.

Apple will be a tech bellwether for a long time, but anyone who doesn't think Apple's future just got a bit more challenging will have to point out who Cook is to me in a new boardroom photo.

Fool contributor Anders Bylund
So Apple's genius leader steps back to a strategic role, permanently this time. The market is taking it in with a giant yawn, because this move has been obvious for months. When I called Apple out as one of the worst stocks to own in 2010, a Jobs-less executive suite was the cornerstone of my risk-related argument. This event still isn't the calamity I was looking for in one of the worst calls of 2010.

The true measure of Apple's new leadership will come when even the chairman's role becomes too much for Steve to bear. Without the visionary mastermind to lead the way, Cook and his advisors will be left to their own devices. Can they continue to pump out "magical" gadgetry year after year, as Jobs has done?

We'll have to wait and see. If anything, removing Jobs from the equation makes investors expect that much less perfection out of Apple. Ironically, Steve's Dear John letter just reduced the risk inherent in owning Apple shares.

That said, Apple is running out of new gadget sizes for the iPad/iPhone/iPod touch family, and it may need to actually come up with some innovation soon in order to keep its customers loyal. Microsoft (Nasdaq: MSFT  ) was once the world's largest company by market cap, but nothing lasts forever. Apple needs to stay fresh in order to stay relevant, profitable, and growing, and I don't know for sure that Cook has that quality in him.

Fool contributor and Rule Breakers analyst Tim Beyers
It's the end for Apple! Not only has the iEmpire lost its visionary, it's lost its soul! Sound the alarm! So say the bears today. Trouble is, they're wrong. Visionaries aplenty remain employed by the Mac maker. But don't take my word for it. See for yourself.

"Right now, from our point of view [netbooks] are principally based on hardware that's much less powerful than we think customers want. Software technology that is not good, cramped keyboards, small displays ... And so, we don't think that people are going to be pleased with those types of products."

Sounds like Jobs, right? Wrong. That's Tim Cook, Apple's new CEO and the company's operational leader since Jobs first took medical leave in January 2009. At the time, he was speaking about netbook offerings from Dell (Nasdaq: DELL  ) , Hewlett-Packard (NYSE: HPQ  ) , and Asian suppliers.

Within a year, he and the team at Apple would introduce the iPad. The netbook market would begin to fall apart within months, and today is teetering on the brink of irrelevance despite Google's efforts with the Chromebook.

Don't get me wrong. Jobs is important to Apple and will be missed, but if you think the Apple of the last 18 months -- a period of unprecedented prosperity for the company -- has seen Jobs at anywhere near his normal levels of engagement, you're deluding yourself. Apple will be fine. Here's hoping that's also true for Steve.

Technology Editor for Eric Bleeker
With Steve Jobs leaving, it's only natural that investors look back to how other companies have fared after losing iconic leaders. However, I'm going to throw a name out that I haven't seen in previous comparisons: Lou Gerstner.

The company Lou Gerstner led, IBM (