• Albert Alfonso
    Einhorn wants $AAPL to issue 50B worth of perpetual preferred stock them at 4% yield? I think thats nonsense. Who would be the buyers?
    2/8/13
    Reply (16)
    • Albert Alfonso: The market for preferred securities is rather limited, also AAPL could probably borrow at a lower interest rate than 4%.
      2/8/13
    • Hillbilly Stock Star: Go to current shareholders pro-rated? $AAPL underwater Long.
      2/8/13
    • Bob de'Long: So Einhorn thinks $AAPL needs equity capital.
      2/8/13
    • Hillbilly Stock Star: Or just increase qtr divy?
      2/8/13
    • Perkins Cove: Yet the price goes up. Was it a psychological thing?
      2/8/13
    • Perkins Cove: An awakening?
      2/8/13
    • Albert Alfonso: But again, who would want a 4% yield preferred? No upside, pathetic yield. $PGF or $PFF are etfs with 6%+ yields
      2/8/13
    • XRTrader: The shares would be distributed to current shareholders. Their desirability would be the strength of AAPLs balance sheet - with enough cash
      2/8/13
    • XRTrader: and FCF to fund the 4% dividend forever. Apparently there's also something tax beneficial about the Einhorn structure that's beyond my grasp
      2/8/13
    • andyk80: Doesn't matter what they do with the cash long term. They are way behind in cloud services. That's what matters not app store or hardware.
      2/8/13
    • andyk80: They will end up squandering this cash hoard.
      2/8/13
    • XRTrader: Andyk - How can you squander 130 billion? That would take real skill.
      2/8/13
    • Ghosts of Kariela: I'd rather let Tim Cook and co decide this. If it comes up to vote, David Einhorn has resistance from CALPERS and ISS so...
      2/8/13
    • andyk80: Apple needs to buy FB, Yahoo, Yelp, foursquare and more just to even start to rival the tightly integrated cloud ecosystem that is Google.
      2/8/13
    • andyk80: Without this cloud ecosystem they are just another device manufacturer and long run they are toast. Too late to build from scratch.
      2/8/13
    • andyk80: They will try and come up short squandering 130 billion
      2/8/13