Apple 2.0

Covering the business that Steve Jobs built

Analyst: Steve Jobs' "spirit" has been institutionalized

December 23, 2008: 2:03 PM ET
Steve Jobs in June

Steve Jobs in June

Traders may be punishing Apple (AAPL) for Steve Jobs' decision to skip his annual Macworld keynote -- rekindling fears about his health in the wake of his 2004 surgery for pancreatic cancer -- but analysts who follow the stock closely generally agree that those fears have been overblown.

Kaufman Bros. Shaw Wu is the latest to weigh in on the issue. In a note to clients Tuesday, he acknowledges that Jobs deserves a lot of credit for the "revival and success of Apple." In language that could have been written by Cupertino's PR department, he credits Apple's CEO with "helping revolutionize the world" with a long list of products and innovations, from the Apple II to the Apple Store.

But he argues that Apple doesn't need Steve Jobs to prosper, because his "spirit" has been "institutionalized":

"In our view, AAPL has an uncanny ability to attract and hire Apple 'fanatics' who are entrepreneurial, work hard, and are looking to change the world. The difference with AAPL today is that in addition to being innovative, the company has world-class operations and execution. We believe for a company of AAPL's size, ... there are a lot of other people besides Steve Jobs driving success including members of its senior management team down to its 32,000 individual employees."

As proof, Wu ticks off a list of hit products that Apple introduced when Jobs was no longer there to drive innovation: the Macintosh Quadra, QuickTime, PowerMac and PowerBook, and Apple IIgs.

Okaaaay. But none of those products quite rises to the level of the iPod, iTunes, Mac OS X, the iPhone or the App Store.

In any event, Wu is sticking with his $12o price target. "With the pullback in the shares," he writes,  "we find the risk-reward favorable for longer-term investors."

Apple closed at 86.38 Tuesday, up 0.75% for the day.

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About This Author
Philip Elmer-Dewitt
Philip Elmer-DeWitt
Editor, Apple 2.0, Fortune

Philip Elmer-DeWitt has been following Apple since 1982, first for Time Magazine, and now on the Web for Fortune.com.

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