Apple Inc CEO Tim Cook Not Doing Enough to Raise Shareholder Value? Analyst Calls for Cook's Removal as CEO
Is it time to replace Tim Cook as Apple Inc CEO? With Apple shares down 5 per cent and now 25 per cent difference from the stock's peak in September 2012, some investors have been worried about Apple Inc's image as an innovative company especially since the demise of its co-founder and former CEO Steve Jobs.
The continued disappointment to investors has prompted Global Equities Research analyst Trip Chowdry to call for the resignation of Tim Cook as CEO of Apple Inc. Mr Chowdry cited Mr Cook's inability to create shareholder value for the company.
The analyst said that Apple Inc's investors and even employees are aware of the fact that other stocks have amassed large amounts of shareholder value in the past 12 months. Apple's CEO Tim Cook and former CFO Peter Oppenheimer, who recently gave up his post, have "systematically erased" shareholder value of $130 billion.
According to Mr Chowdry, Apple Inc stock has declined by 25 per cent since its peak in Sept 2012 while the Nasdaq and S&P enjoyed growth of 36 and 25 per cent respectively.
He wrote in a report that Apple's CEO and CFO must be replaced to prevent "further destruction" of shareholder value. Mr Chowdry then suggested the tandem of Jon Rubenstein and Fred Anderson as the new CEO and CFO of Apple.
Mr Rubinstein had worked for Apple Inc from 1997 to 2006 where he contributed significantly to the development of the iMac and iPod. Mr Anderson served as Apple Inc CEO from 1996 to 2004 after which he gave up his position to Mr Oppenheimer.
Mr Oppenheimer had announced that he will be retiring by the end of September. His successor will be Apple's vice president of finance and corporate controller, Luca Maestri.
Despite Apple's stock buybacks that led billionaire activist Carl Icahn to give up his aggressive stance on more buybacks, Apple's plan to return cash to shareholders has not resulted in a significant increase to Apple's value, according to Mr Chowdry.
He also said Mr Cook had been "complacent" and reluctant to introduce innovative and new products and not just "revamped" versions of current product lines.
In a previous report, Apple Inc's number of institutional investors has declined to a 5-year-low in contrast to other tech companies with lesser cash than the iPhone maker. Institutional ownership of large capital stocks is generally at high levels, except Apple Inc, according to a Morgan Stanley poll. Since 2009, Morgan Stanley has surveyed institutional ownership and found that the top 30 investors of large capital stocks own between 30 to 50 per cent of a certain company's total shares.
Under the leadership of Mr Cook, Mr Chowdry may have grown impatient with the promise of the iWatch and the Apple TV long rumoured to be "game changers."