It appears the rumors were true: Apple (AAPL) is returning cash to its shareholders. At least, that's what you would gather from Apple's announcement Sunday evening that it will be holding a conference call thirty minutes before markets open on Monday to "announce the outcome of the Company's discussions concerning its cash balance." What cash balance is Apple referring to? Oh, just $98 billion. According to ISI Group analyst Brian Marshall, that's equivalent to $104 a share.
Ahead of the call, it seems everyone is speculating as to what exactly Apple should do with all that cash. We at The Hedge Zone hate to think it could be wasted on padding the pockets of the 1%, so we have devised some creative ways that Apple might more strategically deploy its spare change. We hope Mr. Cook considers our (albeit tongue-in-cheek) recommendations.
1. Mail Every Person in U.S. $300 iTunes Gift CertificateNo joke, Apple could actually do this. And why not? Google (GOOG) gives out free e-mail. Plus, you'll get the money back, Tim...
2. Unveil iPad 4
Think you're really cool because you just bought the iPad 3? Guess what? Boom! iPad 4. It would be hilarious. And not much of a stretch for Apple.
3. Bankroll "Good" Ugandan Warlords, Stop Kony
Let's face it: viral videos haven't stopped Kony. But pump $98 billion worth of anti-Kony firepower into Uganda, and you have yourself a problem solved.
4. Purchase "Appletini" Branding Rights, Change Name of Macbook Air
Nothing says overpriced and fashionable like a sugary cocktail. Except for a Macbook Air. This is a branding match made in heaven.
5. Funnel Cash to U.S. Treasury Through Congressional Republicans, Bankrupt Buffett
Citing concern over the rising national debt and Warren Buffett's recent challenge to Congressional Republicans to match dollar-for-dollar personal contributions to pay down the debt, turn all $98 billion over to Mitch McConnell who, in turn, donates it to the U.S. Treasury. Welcome to the 99%, Warren.
6. Fast-Track Launch of Kardashian-Free Apple TV
After stopping Kony, this is clearly the most pressing issue facing our generation. Finally, we have the means to do something about it.
7. De-Friend Mark Zuckerberg: Pursue Hostile Takeover of Facebook
Is this even possible? Probably not. But Facebook is valued at around $100 billion...so we say it's worth a try. Plus, Facebook would be AWESOME to own.
8. Hand Cash to Competitors, Maintain Competition
Not the most intuitive of strategies, but one that may save Apple plenty of headaches down the road. Taking a cue from Microsoft's (MSFT) expensive antitrust battles, Apple could avoid the same legal wrangling by simply giving all its cash to its competitors--to keep them competitive. Otherwise, they would surely be forced into desperate grabs for market share with ill-conceived products at unreasonable prices. See tablets from Hewlett Packard (HPQ), Toshiba, Samsung, Motorola (MMI), and Dell (DELL).
9. Secede, Found Sovereign Nation of iLive
Located in the area formerly known as Cupertino, California, iLive would instantly become the wealthiest nation per capita in the world after $98 billion is distributed among its founding citizenship. Ok, secession may be a bit of a stretch, but you have to admit iLive sounds much cooler than those weird Disney (DIS) towns.
So there you have it: nine thoroughly researched, extremely viable uses for Apple's bucket of cash that do not involve a mere cash dividend. We have strong conviction on this issue and believe Apple would be best served by taking our advice.
Disclosure: I am long MSFT.