The news of Steve Jobs’s bereavement clearly shook the world on Wednesday. The man who has been an inspiration for so many and who made a career out of changing the way people use technology passed away at the age of 56.
His pioneering spirit and business acumen have influenced to some extent the path of many tech companies, including that of Commetric.
Steve Jobs never designed a computer in his life, but it was his visionary and unmistakable business sense which drove Apple to stardom and his name became synonymous with that of his company. As his persona helped make Apple into one of the biggest companies on the planet, investors saw a massive pay off. The past ten years have been reasonably called the Steve Jobs decade, because Apple’s share price has risen 4,557% from its starting price of about $10 per share. Over the last five years alone, the company’s shares have risen 406.4% and follow a continuous upward trend as the graph below shows.
This is why Jobs’s untimely death has left many people wondering how Apple’s share price will fare in the short and long term. Here at Commetric, we are no exception. Unlike most people, however, we have tools that can help answer this question, using the unique approach of combining historical media coverage with our Equity Optimiser/Equity Prioritiser methodology. This allowed us to look at how various news reports on Apple impacted its share price and what were the topics that contributed to the biggest volatility.
The Equity Optimiser methodology incorporates a series of tools that quantify the +/- impact of corporate news on a company’s share price as a guide to business strategy.
Our analysis focuses on how media reports affects Apple’s share price, ranking news topics by the absolute share price change associated with them, based on the coverage and share price movements of Apple Inc. relative to the S&P500. We used a 12-month period ending on 30 September 2011 and sourced articles from major business publications and newswires.
Next, we divided the days with coverage of
each topic into days with high levels of coverage and days with low level of coverage, based on the average normal news flow for the company over the analysed period.
Our proprietary technology has computed the absolute market-adjusted share price movement associated with the days with high and low coverage of each topic. This is then compared to the usual absolute adjusted share price movement of the company’s stock to indicate topics to which investors tend to be more sensitive.
Below are key topics that affected Apple’s share price movements:

As expected, the persona of Steve Jobs was mentioned the most (709 articles under the topic CEO mentioned), compared to the other topics we measure against. This topic brought 33 basis points volatility on average across the one-year period. Somewhat surprisingly, topics related to product launches or upgrades were not associated with any higher than usual volatility (e.g. Company plans/launches product did not bring any share price change in days with high media coverage compared to days with very low coverage).
What caught our attention were two distinct out-of-the-average values:
- 41 basis points change in Apple’s share price when the article mentioned Steve Jobs’s health (161 articles under CEO health issues);
- 71 basis points change in share price when there was a statement or quote of Steve Jobs in the article (104 articles under CEO statement).
To put things in perspective – a movement of 10 basis points of Apple’s shares is a gain or loss of $350 million in shareholder value. In other words, on days when Jobs’s health was discussed, the impact was almost $1.5 billion and on days when he made a statement in the media, the number rose to the vicinity of $2.5 billion.
As a whole, this showed that the most violent market reactions were linked to the CEO-related topics, such as health issues and statements. Compared to the results of other big tech companies like IBM, Hewlett-Packard, this demonstrated undoubtedly that Apple’s share price volatility was directly tied to the persona of Steve Jobs to such a degree that the launch of a new iPhone had visibly less impact on the decisions investors make than a single quote by him.
Our initial question at hand was how Steve Jobs’s death would affect Apple Inc.’s share price in the future and how media coverage would impact investor activity on the company. Some 30 hours after the company announced the passing of Steve Jobs, Apple Inc. dropped by 1% and continues to be in a downtrend. The company is due to report earnings on 17 October 2011, but the questions remain: will Apple overcome the big challenge of losing its iconic leader? Will the company manage to determine its new identity, effectively carrying on its former leader’s vision or will it reinvent itself and evolve beyond the CEO-is-the-company concept?
CEO health issues and CEO leaves the company continue to be the two key topics that drive Apple Inc.’s share price movement. The share price movement when those issues are mentioned in media coverage so far is -1.76%, which is equal to $6,162 million in a day.
Of course, this is all in a day’s data, so no final conclusions can be made on whether Tim Cook will manage to single-handedly manipulate Apple’s share price the way his late predecessor did. However, the historical data we have on Apple suggests that the next few months will certainly be quite an interesting and challenging period for everyone involved in the company, and for those watching on the sidelines.


















