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Brad Kenagy  

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  • The Drawbacks Of Apple's Cash Hoard Are Starting To Show [View article]
    Interesting Idea, however if it were possible I would have thought they would have figured it out by now.
    Apr 29, 2015. 08:49 PM | Likes Like |Link to Comment
  • The Drawbacks Of Apple's Cash Hoard Are Starting To Show [View article]
    Thank you for the comment. As of this point I believe there no bonds that Apple has issued that have a negative coupon rate. The only way Apple would get to a cash balance is in 10-20 years time, and if they never repatriated any of their foreign cash.

    To answer your question, the drawback is that Apple has used about all the U. S. Cash balance they can, therefore they will have to issue large amounts of debt, and divert more cash flows than they have in the past to capital returns.
    Apr 29, 2015. 08:38 PM | Likes Like |Link to Comment
  • The Drawbacks Of Apple's Cash Hoard Are Starting To Show [View article]
    Thank you for the comment. I compiled the data and the data shows that Debt as a Percentage of Total Cash has increased from 11.26% at this time last year, to a current level of 20.71% for the quarter that was just reported. I also looked at Debt to US Cash since US cash is what is available for capital returns you can see that Debt/ US Cash has gone from 92.18% at this time last year to 178.10% for the quarter that was just reported.

    Data Table: http://bit.ly/1bWkrZm

    So as you put it, this is bad for Apple.
    Apr 29, 2015. 08:28 PM | Likes Like |Link to Comment
  • The Drawbacks Of Apple's Cash Hoard Are Starting To Show [View article]
    Thank you for the comment, I agree that it is smart if a company wants to issue debt in this environment given low interest rates.
    Apr 29, 2015. 08:18 PM | 1 Like Like |Link to Comment
  • The Drawbacks Of Apple's Cash Hoard Are Starting To Show [View article]
    Thank you for the comment, you are exactly right, however, there is no way Apple would bring back its cash being taxed at the current 35% rate. Plus any state taxes that California may levy on that cash.
    Apr 29, 2015. 08:15 PM | Likes Like |Link to Comment
  • The Drawbacks Of Apple's Cash Hoard Are Starting To Show [View article]
    I usually would say thank you for the comment, but with the nanny comment you will get no further responses.
    Apr 29, 2015. 08:13 PM | 3 Likes Like |Link to Comment
  • The Drawbacks Of Apple's Cash Hoard Are Starting To Show [View article]
    The cost is low, however, as my one chart showed Apple has increased its debt by 136% over the last five quarters and that trend will continue going forward over the next two years.
    Apr 29, 2015. 08:11 PM | Likes Like |Link to Comment
  • The Drawbacks Of Apple's Cash Hoard Are Starting To Show [View article]
    Thank you for the comment. Yes Apple can borrow cash abroad, the CFO stated when talking about sources of funding for its capital return program "We will raise debt both in the U.S. and outside of the United States." They are not loans that they are getting, they are issuing debt.
    Apr 29, 2015. 08:10 PM | Likes Like |Link to Comment
  • The Drawbacks Of Apple's Cash Hoard Are Starting To Show [View article]
    Thank you for the comment, and I would like to point out, I am not an Apple bear. In February I wrote an article for Apple and my price target from that article is $169.92, so if 32% upside from current levels is "bearish" then yeah I am "bearish".

    http://seekingalpha.co...
    Apr 29, 2015. 08:07 PM | 2 Likes Like |Link to Comment
  • The Drawbacks Of Apple's Cash Hoard Are Starting To Show [View article]
    Intriguing idea to use taxes on repatriated cash to fund highway transportation. The tax rate on repatriation would have to be pretty low companies to have to bring back the cash in my opinion.
    Apr 29, 2015. 08:02 PM | Likes Like |Link to Comment
  • The Drawbacks Of Apple's Cash Hoard Are Starting To Show [View article]
    Thank you for the comment. The point of the article was that even though the headlines says Apple has $193.5 billion in cash, in fact only $22.5 billion is available for use for its capital return program. The remaining $171 billion is OFF LIMITS for capital return use until such time that tax law changes. In addition, the CFO gave no indications that they would repatriate any time in the next two years of the capital return program. Therefore to fund those capital returns Apple is not choosing to issue debt, they are forced to because the majority of their cash is locked up overseas.
    Apr 29, 2015. 07:58 PM | 2 Likes Like |Link to Comment
  • The Drawbacks Of Apple's Cash Hoard Are Starting To Show [View article]
    Thank you for the comment, and Personally I agree with you that I would rather have cash in my pocket. Share buybacks are only meaningful when they lower the float significantly, and with Apple having 5 billion+ shares outstanding they have a long! way to go to lower the float to a percentage that is close to say Autozone or Travelers who are famous for their share buybacks.
    Apr 29, 2015. 05:40 PM | Likes Like |Link to Comment
  • The Drawbacks Of Apple's Cash Hoard Are Starting To Show [View article]
    Thank you for the comment. Buybacks are one of the avenues that a company can allocate cash to which also include dividends, acquisitions, reinvesting in the business. Buybacks do lower the share count as you said which artificially inflates EPS.
    Apr 29, 2015. 05:39 PM | 1 Like Like |Link to Comment
  • The Drawbacks Of Apple's Cash Hoard Are Starting To Show [View article]
    Thank you for the comment. Because Apple has limited cash available in the U.S. Apple will have to issue significant amounts of debt, and divert more free cash flow because its U.S. Cash balance is almost 40% lower than it was at the beginning of the initiation of the capital return program in 2012.
    Apr 29, 2015. 05:26 PM | 3 Likes Like |Link to Comment
  • The Drawbacks Of Apple's Cash Hoard Are Starting To Show [View article]
    I agree with that as well, if something sounds like common sense or logical most politicians would find some way to screw it up.
    Apr 29, 2015. 05:24 PM | 3 Likes Like |Link to Comment
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