Here's one of those peculiar Apple paradoxes: One year after the death of Steve Jobs -- the iconic leader Barron's once called "the world's most valuable CEO" -- Apple's value has soared.
Shares of the company are up almost 80% since its visionary co-founder passed away. In 2012 alone, Apple's stock raced past the $500, $600 and $700 price marks, making it the most valuable company of all time.
From one angle, that's no surprise. Jobs left his company in the best shape of its life, with a top-selling product lineup, an enviable management team and an invincible aura of cool.
Still, few expected a year this extraordinary.
CEO Tim Cook took over a rocket in mid-air and blasted it even higher. The iPhone and iPad set sales records, the company won a landmark patent lawsuit against chief competitor Samsung, and Apple's holiday sales led to the second-most profitable quarter ever in U.S. corporate history. Suddenly, investors caught up with what financial analysts had been saying for years: Apple, already sporting the highest market cap of any technology company, was actually undervalued by most metrics.
Steve Jobs' absence at Apple's helm has technically been nearly two years long -- starting Jan. 16, 2011, the day he took his third and final medical leave and handed the day-to-day activities over to Cook, then Apple's chief operations officer.
Jobs' genius was never in the logistics of running a company; it was the "yeses" and "nos" of knowing which visions to pursue and which to abandon. He was doing that almost right up to his death, according to biographer Walter Isaacson, all throughout his medical leave and even during his very brief, six-week stint as chairman after handing the CEO role over to Cook.
It's been an amazing run. Cook's second year is shaping up to be far more challenging.
"Apple now is riding the coattails of Jobs' tremendous success," says Daniel Morgan, a portfolio manager at Synovus Trust, whose funds hold Apple (AAPL) as a stock. "Without Jobs, you have to wonder if and when this wave of success peters out."
Many Apple customers found themselves pining for Jobs recently after Apple bungled the debut of its much-maligned Maps app for the iPhone and iPad. Since Apple Maps launched, Apple has lost nearly $40 billion in market value.
Would Jobs have released a clearly flawed product? We'll never know. He was involved in much of the decision-making about the Maps project, but he was not around to give it the ultimate go-ahead.
Even more important are the products that Jobs won't be around to create.
Apple's stock price has risen in nine of the 12 months since Jobs passed away, lifted primarily by Apple's machine-like execution on products that he set in motion. Shares gained steadily for months in anticipation of the third-generation iPad's announcement and the iPhone 5's launch. Frequent reports of an Apple TV reinvention -- a market that Jobs claims to have "finally cracked" in his biography -- also gave the stock a charge.
The next rabbit Apple is likely to pull out of its hat is an "iPad mini," rumored to be launching later this month, according to Fortune. That, too, was a project Jobs had a hand in.
In fact, one of the only big boosts to Apple's stock in 2012 that had none of Jobs' fingerprints on it was the company's dividend and stock buyback. In March, Cook made the long-awaited announcement that Apple would return a chunk of its $100 billion cash hoard to shareholders.
Apple has plenty of runway. On the strength of the iPhone and iPad alone, it should be able to keep up its astonishing profitability for years. There's plenty more market share to grab in phones -- the iPhone makes up just 6% of the mobile market globally, according to IDC -- and tablets are still a nascent market.
But as happened with the iPod, whose popularity has come and gone, the day will inevitably come when the iPhone and iPad's ascent will stall. To maintain its current sales growth rate, which Wall Street analysts expect to be about 45% this year, Apple will have to come up with a new blockbuster product for the post-Jobs era.
Wall Street is doubtful. Current forecasts show Apple's sales growing 23% over the next year.
"The question of 'can they keep growing so fast?' is a function of what's the next product category that they enter," says Daniel Ernst, analyst at Hudson Square Research. "Those are questions for Apple with or without Steve Jobs."
Many seem to believe that television is the next market Apple will revolutionize. Cable providers aren't so eager for Apple to disrupt their businesses, though. They already saw the bloodbath that followed Apple's transformations of the music and wireless industries.
If Apple does have another magical technology up its sleeve, it's a very well-kept secret -- something increasingly rare in a company that used to pride itself on confidentiality.
Apple has a strong talent pool of engineers and designers, but Tim Cook's operational genius will only be able to squeeze out so many efficiencies from the current product lineup. To keep its hot streak going, Apple will have to prove it can still innovate.
That's something the investment world rarely questioned when Steve Jobs was in charge.
