The New York Post reports that concerns remain over Apple, Inc. (NASDAQ: AAPL) CEO Steve Jobs health after he appeared thin at recent developers conferences. This is making investors nervous since it's not likely that anyone can do as good a job as Apple CEO. And Apple's board may have a duty to report on Jobs' health if he can't perform his duties.
I became familiar with this legal requirement two years ago when questions were raised to me about the health of Lazard Ltd. (NYSE: LAZ) CEO, Bruce Wasserstein. The basic requirement for a board is unclear. As I wrote: "it appears that there are two conflicting points of view on the topic. On the one hand, the illness of the CEO -- particularly one as highly regarded as Wasserstein -- is material information under Regulation Fair Disclosure (FD) that could cause an investor to sell if it was disclosed. On the other hand, laws such as The Health Insurance Portability Act (HIPAA) protect the privacy of employee medical records."
In 2003, Jobs had a bout with pancreatic cancer. He recently appears to have lost a significant amount of weight according to the Post. In the case of Jobs, he seems to be appearing in public and doing his job, but the prospect that he might soon be out of Apple's developing picture does not bode well for investors. The lack of comment from Apple seems ominous to me. Meanwhile, Apple is expected to report EPS of $1.08 on revenue of $7.36 billion, according to First Call estimates.
Peter Cohan is President of Peter S. Cohan & Associates. He also teaches management at Babson College and edits The Cohan Letter
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Reader Comments (Page 1 of 1)
7-21-2008 @ 1:34PM
Aquia33 said...
As best I can tell the only concern is coming from a single writer in Bangalore, the story is syndicated and "journalist" are all a flutter.
Quote a few hundred stockholders that are concerned, provide some meat around the self generated whispers.
7-21-2008 @ 1:57PM
Beltway Greg said...
And Wasserstein is still quite wealthy and healthy, yes? Lazard Ltd. is insolvent correct? Now we're getting our in depth business coverage from the New York Post. They rank right up there with the new Conde Naste publication "Portfolio" and that "Trader Monthy" magazine. Instead of the usual reportage concerning A-Rod slipping the salami to The Material Girl they decide to slip the bologna to shareholders. Listen Peter, remember the post "Apple Care to take a Bite" in which you proclaimed the possibility of Apple dropping to $100 and I offered to bet you an new IPhone or 5K that it would see $150 before $100. Well here we go again. Look this story has been beaten to death. Is Jobs sick? Maybe. Will the stock take a hit if he steps down. Definitely. How much? Who knows. Now pay attention, this is where your professorial bidness training can actually be of some utility. Instead of rehashing old news try these topics on for size.
A. How does all of that deferred revenue affect the balance sheet go forward?
B. How many companies have lost CEOs and still continued to be profitable enterprises?
C. Gates recently stepped/fell down/was thrown out the door and left the Stevie "Wonder" Ballmer in charge to pursue ventures of limited utility. Was this wise?
D. Let's review. IPhone, IMac, ITunes, The Apple Stores, IPod, and who knows what else is in the pipeline?
E. And is totally incomprehensible to me that Apple lacks a plan of succession: after developing all of the products and so effectively managing the supply chain the board would over look such a simple facet? This isn't a lemonade stand.
Tomorrow? Who knows. $260 by Dec. 31, 2008 with or without Jobs. But I love ya anyway Steve.
BTW, who is the CEO of RIMM and is he getting any younger?
Beltway Greg
7-22-2008 @ 2:09AM
John said...
Hmmmmmm. Sounds like Beltway Greg is an Apple cheerleader. This company has a lot of them. What they all fail to realize is that Jobs= Apple. Without him, just like Microsoft without its ruthless founder, Apple is a has-been. Might as well go find John Scully to take the reins again. Scully came in with so much hype after Jobs left the first time, you would have thought he was the Messiah. It is Jobs' marketing savvy that put Apple on the map, not the toys--computers, iPods, iPhones--the company produces. Apple is as much Jobs as Berkshire is Buffett/Munger and MSFT is Gates. When they're gone, their companies will soon go down.