Tim Cook announced his retirement right as Apple hit a $5 trillion market cap. Perfect timing. Nothing says "the fundamentals are sound" like the CEO sprinting for the exit at all-time highs.
The stock just crossed into record territory. Retail traders are celebrating by adding more shares to their portfolios using money they don't have. They believe this means Apple will keep going up forever because that's how numbers work when you've never read a 10-K.
Cook still has concerns to address on his final earnings call. Concerns like how to explain that a company selling incrementally better phones every year is somehow worth more than the GDP of Japan. Or how to justify another buyback program while pretending innovation still happens in Cupertino.
The earnings call will feature analysts asking softball questions about services revenue growth. Cook will respond with prepared answers about ecosystem strength. Everyone will nod. The stock will move 2% in a random direction. CNBC will call it volatile.
Somewhere a 24-year-old with a Robinhood account is convinced he's a genius because he bought Apple at $180. He doesn't know what the P/E ratio is. He doesn't know what earnings per share means. He knows the line went up and his cousin said Tim Cook is a visionary.
Cook's legacy will be taking Steve Jobs' company and turning it into the world's most valuable stock buyback machine. He mastered the art of doing less while the market cap did more. Shareholders confused financial engineering with product innovation. It worked for 13 years.
The next CEO inherits a $5 trillion valuation and the impossible task of justifying it. Good luck explaining to investors why the next iPhone doesn't cure cancer.
Photo by Laurenz Heymann on Unsplash
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