Apple is the World’s Most Valuable Player

by Ben Bajarin   |   February 28th, 2013

apple_store_france_carrouseldulouvre_002As you may recall, the late Steve Jobs was said to have a reality distortion field in the way he saw the world. It was articulated that Steve would create alternate realities which were actually distorted realities. Since his passing his reality distortion field still exists but it has moved from inside Apple to outside Apple. Mainly to the many on the street and the mainstream media (just looking for headlines) who have caught the reality distortion field syndrome and now live in a reality distortion field and believe in a reality that does not exist.

I wrote two articles that should help any smart person understand the landscape of the tech industry. The first one was titled What Tech Company is More Healthy Than Apple. The second I wrote yesterday called Google or Microsoft? That is the question. It is designed to give you the perspective of the landscape from an OEM (not named Apple) shoes and the immense challenges that lie in front of them. If you read them both in succession, I do not personally see how you walk away with any doom and gloom scenario for Apple.

However, even more data came out today proving that most outside observers and naysayers have caught the reality distortion field.

Fortune today released their list of Worlds Most Admired Companies. This is not a list of just tech companies but simply of enterprises on a global level from every field. This work and research is done in conjunction with the Hay Group and it surveys 15,000 business executives and directors to rate their peers in several different category. To use an analogy, this survey is like ones in sports where athletes vote for other athletes they think are the leaders in certain categories.

The result is in. The global industry professional audience has voted Apple the MVP of the business world. The Hay Group, in conjunction with Fortune, found that Apple is the world’s most admired company. Apple came out number one in the following four categories:

- The Worlds Most Admired Company
- The Worlds Most Admired Tech Company
- Most Admired in Innovation
- Number 1. in product quality

People say Apple is doomed, people say they have lost their “mojo” but those in the industry running actual fortune 500 companies disagree. They still say Apple is the gold standard on many levels. This is just more fuel for the fire that the reality distortion field has moved from Apple the company and out into the views of those who have lost the ability to think critically about Apple.

Fortune’s own description in the listing should be enough to burst the reality distortion field.

it (Apple) remains a financial juggernaut, posting $13 billion in net income last quarter, making it the most profitable company in the world during that period.

Apple is the most profitable, can’t make enough products to meet demand, is the most admired by its peers, yet it is doomed. Reality distortion field.

The facts don’t line up with the picture being presented by the street and the headline seeking mainstream media. And the most unfortunate thing about it is that it is affecting many who aren’t stuck in the reality distortion field. Apple’s shareholders.

There are many good people who understand that Apple is positioned for success and made wise long term decisions to have Apple stock as a part of their retirement funds and who either depend or will depend on that money some day. In my opinion, Apple’s shareholders are being punished for being wise. I do not own any Apple stock but if I did I would be livid at the fact that all the evidence in terms of health and signs of long term success favor Apple. Yet the Street continues to play the game and live in the reality distortion field. The media is to blame as well because as unfortunate as it is they can to a degree, alter public sentiment in incorrect ways simply because they have the desire to chase page views with a catchy headline full of half-truths.

We can only hope that wiser minds prevail but one thing is certain. Those who run and manage billion dollar companies find Apple the gold standard. We can only be glad that those living in the reality distortion field don’t run those billion dollar companies or our world would really be in trouble.

Tags: ,

Ben Bajarin

Ben Bajarin is a Principal Analyst at Creative Strategies, Inc - An industry analysis, market intelligence and research firm located in Silicon Valley. His primary focus is consumer technology and market trend research. He is a husband, father, gadget enthusiast, trend spotter, early adopter and hobby farmer. Full Bio
  • gjgustav

    Finally, someone calls it like it is.

  • Ochyming

    Why the foul attack on Apple is not viewed as just an attempt to make money/attract attention?

    Rumor sites have been doing it as well the BBC online, the rest of the mainstream media are just catching up.

    • SSShu

      Making money and attracting attention at the expense of Apple, its shareholders, and possibly its user-base?

  • the Ugly Truth

    RE: “We can only be glad that those living in the reality distortion field don’t run those billion dollar companies or our world would really be in trouble.”

    Ummm..they already do Ben! That is why AMZN or CMG or CRM or NFLX or GOOG is valued the way it is and AAPL is stuck with a PE like my Grandma’s utility stock portfolio!

    Of course, Samsung (with its billions to spend on sociopathic ads) has something to do with this as well. Does the average Analyst really understand that GOOG doesn’t really control or make huge amounts of money off Android?

    • benbajarin

      I disagree that financial analysts run the world. They simply affect the stock but the stock does is there for external value creation not so much internal value creation.

      Its key to separate the stock analysis from the company analysis.

      • the Ugly Truth

        Ben…is that a droid in tux? cute…

        BTW…never said “financial analysts run the world”…hence, I took the time to quote the line (on its own) that you wrote.

        Snakes in suits already occupy the top ranks in the corporate world or the government. It would be difficult for someone without sociopathic values to succeed. I haven’t come across any whistle blower who became famous, rich, popular and still alive lol!

        • benbajarin

          Sort of, its a droid I made at google’s booth at MWC last year. It is from their Androidify me app. Its supposed to be me in a sport coat with a cup of coffee and my smartphone in hand. Pretty much how you would see me out in public :)

          The reason I phrased that the way I did, was because of the survey methodology. Meaning that Apple’s corporate peers voted them the worlds most admired company. CEO’s, execs, directors, etc in the most powerful corporate brands voted for them in those regards. I doubt financial services companies were a large part of the survey but rather it was Coke, Pepsi, Nike, etc..

          Yes there are surely some corporate snakes as you call them but I run into execs and CEOs at many companies throughout the industry who are not.

  • http://twitter.com/NWNirvana The Dictator

    Oh believe me I’m livid. And when I meet someone in real life who spews the same crap as the online blogs and media does, they are instantly my enemy.

    • BC2009

      I know how you feel — I cannot listen to somebody spew falsehoods about Apple and Samsung without correcting them. I refuse to let that misinformation slide. It has gone from a “matter of opinion” to outright lies.

  • Kyrke

    Excellent Ben. Just my suspicions that parasitic financial investors have a lot to gain by working the reality distortion field in a way that sends AAPL in directions that fit their desires. I think the biggest test of Apple is staying focused on their vision/execution and not be distracted by Wall Street games.

  • Jurassic

    If anyone has read Superman stories, you might think that we are all living in Bizarro World…

    Bizarro Superman: “Apple is largest, most profitable, most innovative, most admired company… therefore Apple is doomed! Must invest in smaller, less respected companies that are losing money… they successful!”

  • BC2009

    The parallel I see here is an undefeated NFL team beating everybody by double digits each week and yet the press is covering the second-place team and constantly justifying why they are a better team.

    Better yet, if Apple and Samsung were NFL teams, Apple would be beating them into oblivion in three consecutive quarters and then equalling them in points in the fourth quarter as they benched their players (i.e.: the quarter where they about to release a new iPhone and the old one has lagging sales). Despite Apple’s dominating lead on their next major competitor the sports announcers are pandering to the Samsung fans and raving about what a great fourth quarter they are having and how this bodes badly for Apple in their next matchup.

    But the constant thing I am seeing is that they always seem to be talking about the “next matchup”.

  • pawhite524

    Terrific article, again, Ben.

    Another reason for the idiocy being printed, i.e., Apple is doomed, is a fundamental of newspaper/media headlines: Man bites dog attracts readers, dog bites man does not.

    • steve_wildstrom

      The problem is that dumping on Apple is no longer a man bites dog story. It has become conventional wisdom.

      • pawhite524

        I’d appreciate your thoughts on why the negative publicity if it isn’t to grab page views? If I was a conspiracy theorist I’d be thinking Samsung’s 12 billion dollar marketing budget has found its way into cash strapped entities like the WSJ, NYT, and many web-based sites. I have no doubt techpinions is not in this unpleasant, if once illustrious, company.

        • steve_wildstrom

          I think it started out mainly as linkbait by some tech sites and publicity grabbing by some analysts. The widely held view that decline was inevitable after the death of Steve Jobs was a big part of the growing negativity.

          I also think confusion has been caused by the amazing transformation of Apple in the last three or four years. It very quickly became a big company, much bigger than most of its competitors, but is still expected to behave and perform like the nimble, scrappy player it once was. Expecting the $120 billion Apple of today to perform and think like the $25 billion apple of 2007 is silly, but people keep assuming it can and will and are disappointed when it doesn’t.

          What I find mysterious is that even during the period of fastest growth and a rapidly rising share price, Apple’s stock never was priced as though investors believed the growth was sustainable, which was wise. But when growth inevitably slowed, the market responded with a massive selloff, driving the P/E to ridiculously low levels. If this keeps up, Apple will be able to take itself private with its own cash.

          • jfutral

            Plus, it is safe to be the doom sayer. If the doom comes true, one can say “I warned you”. If things get better one can say “Good thing I warned you.”

            And Wall Street analysts make their money by guess… er, I mean “predicting” the future.

            So we are probably also seeing a kind of need to out do each other in predictions.

            Joe

          • pawhite524

            Thank you for this thoughtful response. I read techpinions for exactly this reason. I am continually impressed by the sagacity of the writers and the thankful for the gentlemanly (generic use, not meant to sexist) posts by commenters who, typically, add to my knowledge of the subject as well. A safe harbor if there ever was one…

          • David Ryder

            I know I’m a day late to this post, but I am one of those livid investors. I’ve wanted to reply “Yes, oh yes” to every post here, but yours is the one I picked because you reminded us that AAPL was also priced for slow growth. At $700 it was starting to get to a more appropriate level.

            What to do? I’m hanging tough. As long as the world has some rational thinking left, somewhere, the price should come back up.

            PS. Ben – Great Post. Thank you for a dose of common sense.

  • Carlos Revelez

    The real question here is WHY Apple has so many enemies and haters. I don’t get it, really I don’t. I like a company committed to quality and its customers. I truly believe that this is a company I can trust in and I can depend on (if I am a shareholder of it) because their numbers every quarter say it is a company prepared for the future, not only for the present. Maybe is time for Apple to start an overwhelming PR campaign, Samsung-style, or to make more and bigger cash reserves, because Google, Samsung and Microsoft are just waiting for a mistake from the Cupertino giant.

  • Space Gorilla

    “punished for being wise”, I think you might be onto something here. It is odd why so many people seem to be angry about Apple’s success, or carry an anti-Apple bias which leads to so much flawed analysis. Perhaps it is because most people just aren’t that smart, and humans generally don’t like the smart kid (Apple).

  • http://www.facebook.com/vanminh.nguyen.73 Văn Minh Nguyễn

    Apple’s rivals are making large innovations aswell, Apple just has the marketing advantage, in the comming years Microsoft shall prevail, I’m not saying Apple will fall, it just won’t be the Nr. 1 innovator, both Microsoft and Google are great players, look at Google Glass, people will only buy the iWatch because Apple prizes itself as ”cool” and people (literally) buy it.

    Soon we’ll see Asian brands (like Samsung, H.T.C. and L.G.) defeating the iPhone with Android and Windows Phone, on the tablet market Apple has already stolen from Microsoft, and Microsoft is comming back, and Google doesn’t let this slide either.

    The iPod will be replaced with an Xbox Media device, and the Kinect is more fit for both traditional- and smart-T.V.’s as Apple T.V.

    People don’t say ”Apple is doomed” because it somehow lacks behind, they say it because its opponents don’t.