An apostrophe, when used in the pronoun + suffix form,
always indicates a contraction. He's/He is, it's/it is, they're/they are.
When used in the noun/pronoun + s form, it indicates possession. Bob's, her's.
If there is a conflict, the contraction always wins out and the possessive form loses the apostrophe. A contraction should never lack an apostrophe, it is "in place of the letters removed".
Of course, there are an incredible amount of exceptions in English ("yours" being one of them), but it's good to understand this. Especially as a native English speaker.
