Apple stock is having a surprisingly muted reaction to CEO Tim Cook’s exit. Here are 3 reasons why

Yesterday, Apple announced that its longtime CEO, Tim Cook, will step down in September, with John Ternus, the current senior vice president of hardware engineering, taking over.

The move marks the first change in Apple’s chief executive since Cook assumed the role from Steve Jobs in 2011.

However, while the prior chief executive shakeup saw Apple Inc.’s stock (Nasdaq: AAPL) get shaken up too, shares in the company are relatively stable this time, at least for now. Here’s what you need to know.

What’s happened?

Yesterday, after the markets closed, Apple dropped a bombshell: its longtime CEO, Tim Cook, will be stepping down. Stepping into the role is John Ternus, the company’s current hardware engineering chief.

Normally, even at smaller companies, CEO shakeups make investors nervous. No one likes uncertainty after all.

But at a company the size and value of Apple, a CEO change is monumental, introducing a range of uncertainties about how the business will operate going forward. These uncertainties can lead investors to sell off the company’s stock—at least until they have a better grasp of the situation.

And indeed, during Apple’s last CEO shakeup, that’s exactly what happened. On August 24, 2011, Apple announced that Steve Jobs would be relinquishing his role as CEO and that Tim Cook would assume the position. As a result of that announcement, AAPL shares immediately fell more than 6%.

But that dramatic price drop in AAPL’s share price is completely absent this time around. As of this writing, AAPL shares are currently trading relatively flat, down just two-tenths of a percent. That’s the same type of premarket fluctuations you see on any normal, non-news trading day.

So why are investors taking the CEO shakeup in stride? There are three likely answers.

Apple isn’t a one-man band anymore

The first reason investors are likely handling the news of a new Apple CEO better than they did the last one is Steve Jobs himself.

Back in 2011, Apple was considered virtually indistinguishable from Steve Jobs. Not only did Jobs cofound the company, but after he returned to it in the late 1990s, he led it to become the most influential tech company in existence.

In the roughly 10 years before his resignation, Jobs’s Apple transformed the consumer tech landscape with the iMac, iPod, and iPhone.

At the time, many investors worried that Apple’s continued success relied on Jobs’s innovative vision. They had much less faith in the team of other visionaries and innovators that Jobs had assembled.

But since then, Cook and Apple’s other top talent have proven those investor worries were overblown.

While Jobs’s impact on Apple and the broader tech industry is clear, it is now also clear that Apple is more than just one man, and its ranks are packed with competent individuals who have helped drive the company to heights Jobs could not have dreamed of.

The Ternus factor

Apple’s choice for its new CEO is also another reason why investors aren’t pulling their hair out. Reports suggest that John Ternus is well-liked at the company and is known as being a hardware-focused and decisive leader.

But Ternus also has another thing going for him: his age.

As I wrote last year, Ternus is only 50 years old, which means he has the potential to be in the CEO role as long as Tim Cook. Investors like stability, and they are likely encouraged by the fact that Ternus’s age means Apple won’t need to consider hiring a new CEO in the next five or 10 years.

A third plus in the Ternus column is that he was widely assumed to be the person most likely to step into the CEO role after Cook’s departure. This long-term assumption led to many investors getting comfortable with the idea, leading to less of a shock factor.

Cook will stay on to manage government relations

I have always seen Cook’s tenure as CEO as one of the best things that has ever happened to Apple. During his reign, he took the company from being worth hundreds of billions to over $4 trillion.

But Cook has also proved himself adept in areas other than sales and revenue growth, including government relations, particularly in the Trump era in America, though also in China, Apple’s second-largest market.

Apple under Cook may have been able to dictate terms to its business partners, but not to governments. And in an era of constantly changing regulations and trade objectives, successfully liaising with government leaders is arguably as important to a company as sales.

Tim Cook has proven himself time and time again as one of the most adept business leaders at engaging with political leaders—a skill he has had the time to hone.

But even though Cook is stepping down as CEO, Apple won’t lose its most experienced government liaison. In announcing Cook’s departure, the company was careful to say that, in his new role as executive chairman, Cook will continue “engaging with policymakers around the world.”

That single line item likely caused many investors to breathe a sigh of relief that Apple was not losing its president whisperer.

AAPL stock holding steady on Apple CEO news

The three reasons above are likely heavily contributing to AAPL’s stock price stability this morning.

As of the time of this writing, AAPL shares are currently down just 0.15% to $272.65, making them essentially flat for the year. Over the past year, AAPL shares have risen more than 38%.

But the real story is Apple’s share price over Tim Cook’s tenure. When Tim Cook stepped into his role as Apple CEO, the company’s stock traded at a split-adjusted price of around $12 per share.

Since that time, AAPL’s stock price has risen by more than 1,900% during Cook’s tenure. That’s an increase investors will be hoping Ternus can replicate.