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Would You Sell Apple Before it Goes to $1,000?

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One top-ranking Apple (NASDAQ: AAPL) exec did just that, parting ways with 95% of his shares.

Scott Forstall, the senior VP of Apple's iOS software division, has sold more than 64,000 shares of Apple stock, earning nearly $39 million in the process. Considering the many rumors that Apple will go to $1,000 within the next few years (some think it could happen as early as 2013), some are worried that this is a sign that Forstall plans to leave Apple for another tech giant.

But CNNMoney notes that has two retention bonuses that could prevent him from jumping ship: "100,000 restricted stock units (RSUs) that were granted in 2010 and vest in 2014, [and] 150,000 RSUs granted in 2011 that vest in equal parts in 2013 and 2016, provided he stays with the company."

If Forstall plans to stay with Apple, some might wonder why he would sell any of his shares right now.

I have a few theories. For starters, the amount of money that he will (could) make from his future shares is colossal. If Apple goes to $1,000, CNNMoney reports that he could earn at least a quarter of a billion dollars. Thus, he may have been willing to cash in his current shares early, knowing that there are more where they came from.

Forstall may have also realized something that few of us understand before it's too late: that life is too short to wait for tomorrow. Sure, his shares might be more valuable a year or two from now. But where will he be at that time? What will his life be like? By selling his shares today, he gets to enjoy a level of wealth that most people can only dream about. And he gets to enjoy it with the knowledge that a greater degree of wealth could be on its way.

Further, Forstall might be looking to make other investments -- or start his own company. If he were to start an iOS development studio, for example, he could still feasibly work with Apple, produce successful apps, and one day sell his company to the Mac maker for a large sum of money. Isn't that what every entrepreneur dreams of -- an Apple buyout? I suppose a Facebook buyout wouldn't be too shabby either, even if the social network has become a dumping ground for VCs.

Whatever the case, I find it hard to believe that Forstall will leave Apple anytime he soon. While the lure of working for Google (NASDAQ: GOOG), Microsoft (NASDAQ: MSFT) or some other tech giant might be tempting, those companies would have to offer Forstall a $250 million salary and stock option package just to match his potential earnings at Apple.

All things likely, that isn't going to happen.

Follow me @LouisBedigianBZ

Posted-In: Apple GoogleLong Ideas News Short Ideas Success Stories Tech Trading Ideas


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