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Apple (AAPL +1.5%) has shot higher in afternoon trading. Rumors about a special dividend appear...

Apple (AAPL +1.5%) has shot higher in afternoon trading. Rumors about a special dividend appear to be the trigger. (earlier: I, II)
Comments (91)
  • I think a special dividend would be a bad move - a one time shot that would send the wrong signal to the market.
    11 Mar 2013, 04:04 PM Reply Like
  • Apple has already spent enough time since early November 2012 to have made their decision as to what they should promptly do with all their excess CASH. As for me, I believe that Apple should:


    1. Increase the quarterly dividend 50% to $4.00/share.
    2. Split the stock shares 10:1 to allow for an increase in
    the number of investors who can afford to buy 100 shares.
    3. Announce a New Buy Back of $100 Million worth of shares to
    effect immediately upon the successful conclusion of the
    previous Share Buy Back. ~220,000 sahres.
    11 Mar 2013, 09:37 PM Reply Like
  • APPL could buy back 100billion, if it wanted. 100million would have the same effect of spitting in the ocean
    12 Mar 2013, 12:50 AM Reply Like
  • I agree. Increased normal dividends and/or increased share buybacks are what I'm hoping for.
    11 Mar 2013, 04:08 PM Reply Like
  • This stock needs something, if only to put some fear in the bears. Anything that works to move the stock up has my support. Best would be a massive new buyback. But for gods sake, management, do SOMETHING !!!!!
    11 Mar 2013, 04:09 PM Reply Like
  • i wouldn't count on it being a special dividend. Rumours are mostly rumours...and turn out to be false (or in the case of Kass, a way rise the stock then sell on the rise).


    You shouldn't want Apple to just do anything ASAP, i'd rather they took their time and make a good judgement rather than do something quickly just to please some disgruntled investors which might have long term bad effects.
    11 Mar 2013, 04:38 PM Reply Like
  • exactly.
    11 Mar 2013, 04:54 PM Reply Like
  • Yeah Stan not. That's all we need is to put fear into investors! NOT, NOT, NOT. If you become a member of management, bet you'd sing a different tune. This whole reaction is pure speculation and ridiculous.
    11 Mar 2013, 04:55 PM Reply Like
  • I do not understand the angst and worry of posters here.
    Whether or not Apple increases its dividend sooner or later doesn't matter in the grand scheme of things.
    If the shares seem low to you, you either 1. came late to the party 2. are a trader 3. should buy more shares now.
    Since Apple management knows best what their business plans are for the future, if you are annoyed with them you should: 1. write a letter 2. vote your proxy 3. sell your shares of AAPL.
    In investing, sometimes patience is a virtue.
    11 Mar 2013, 04:57 PM Reply Like
  • u01bsb0: Tim Cook has been saying they have been thinking about their cash for close to a year now. How long do you think they need?
    11 Mar 2013, 05:09 PM Reply Like
  • Take their time?


    They've been ruminating on this for months! For example, it was last September that it was leaked that they had approached bankers to look into a 10-1 stock split.


    It was a year ago next Monday that they announced a dividend and stock buyback so not long to wait now.
    11 Mar 2013, 05:20 PM Reply Like
  • Perhaps they have been taking their time and this is a well considered strategic move.
    11 Mar 2013, 05:40 PM Reply Like
  • but probably only properly thinking about it for a couple months....the thing is they want to get the best legal advice with what to do because in apple's case, the difference between using one method of returning cash to shareholders over another could cost billions through tax they might not need to pay.
    11 Mar 2013, 06:54 PM Reply Like
  • You took the words right of my mind, i have been very supportive in management desc. But at this time i don't give a s$&t!!!... About good or bad management JUST DO SOMETHING!!!... And DO IT NOW... This stock needs all the help in the world, anything that can make a Stop in these Drop, would be very Welcome!, even if Apple starts to make Washing Machines and starts to copy all of the Samsung products, i really don't care anymore!, and i think these, by the way they have treated investors since mid September! A simple speech of TC on any bad rumor or something, TC would announce tomorrow that is all BS and would think about it for the next 20 years... It simply looks like the board of Apple are SHORT in their own company!... and they are doing a GREAT JOB!!
    12 Mar 2013, 12:27 AM Reply Like
  • I agree with this analysis Kimboslice, with an addendum, if you lose in the proxy, or sell your shares, do not complain about what the stock does after the next big thing is released
    12 Mar 2013, 04:22 PM Reply Like
  • I'm more interested in the ~million shares traded after the close @~$12 below the closing price.
    11 Mar 2013, 04:11 PM Reply Like
  • Gen, can you post a link to where you got that info?
    11 Mar 2013, 04:16 PM Reply Like
  • Totally untrue. Where did you get your information? Only several thousand shares after the close.
    11 Mar 2013, 04:19 PM Reply Like
  • Why not? That would take it back down to where it was trading at 11am. Didn't this rumor BS just happen a couple of weeks ago? Somebody made a nice score.
    11 Mar 2013, 04:21 PM Reply Like
  • I See a transaction for 345,914 shares at 16:37 on After hour Nasdaq site. with 437.87 price
    11 Mar 2013, 04:51 PM Reply Like
  • Streaming quotes off E-Trade. .... though I did make an interpretation mistake [embarassed]; My brain was thinking CNBC trading which if for the day. E-trade reports relative to the close. It traded $5+ below the closing price. Right now it's trading down about a $1 below.


    Look at the day chart, you'll see a 1 million share spike after the close.


    Edited: Just checked again. E-Trade is showing a huge trade after the close, but I can't find it showing up anywhere else. Either E-Trade data is messed up or it was an execution within E-Trade.
    11 Mar 2013, 04:55 PM Reply Like
  • 80000 shares traded after the close
    11 Mar 2013, 05:06 PM Reply Like
  • This gets more interesting by the minute, I'm seeing multiple large trades occuring at ~4:03 for under $432.50. And then another huge trade at 4:37 for $437.87 [the closing price].


    I have a feeling someone is getting some priveleged treatment. And it's not me.
    11 Mar 2013, 05:18 PM Reply Like
  • I'm seeing a lot more than 80,000.


    I've tossed out the idea that it was a data glitch. I'm in the 'someone is getting some special treatment'.


    I've seen that happen with some ETFs I've traded. Sudden blips of large volume before or after market, well under last quote and then a return to normal. I would like it if a broker would scratch my back like that one day.
    11 Mar 2013, 05:47 PM Reply Like
  • Is there anyone reading this who could briefly explain block trades. Aren't these deals between large institutions to buy / sell large blocks at a price to be determined by trading during a period such as a day? Wouldn't they print on the tape after close? Am I imagining this?
    11 Mar 2013, 07:25 PM Reply Like
  • Just ask Dough Kass....
    12 Mar 2013, 01:01 AM Reply Like
  • A decision is already on the table, a important week for Apple shareholders...finally.
    11 Mar 2013, 04:15 PM Reply Like
  • Use it all to buy stock back, and then use the reduction in shares to permanently increase the dividend by the commensurate amount--buybacks, the gift that keeps on giving!
    11 Mar 2013, 04:22 PM Reply Like
  • They have more money then they would be allowed to buy shares back with. STX is having that problem.
    11 Mar 2013, 05:13 PM Reply Like
  • Giddy up! Get ready, although not a straight line.
    11 Mar 2013, 04:27 PM Reply Like
  • Please DO NOT pay special div!!!
    Just increase regular div is better for share holders.
    11 Mar 2013, 04:30 PM Reply Like
  • need for a special divy...just buy back shares and increase reg divy by 30-40%
    11 Mar 2013, 04:39 PM Reply Like
  • I predict a week ago here in SA I believe the board will increse the divident in their next meeting. I still believe it is a regular divident increase and not a special devident. It will make APPL yield over 3%
    But iPhone business has continue to deteriate and APPL is going to have a very difficult april to june quarter
    11 Mar 2013, 04:48 PM Reply Like
  • They will probably throw out 10 bucks a share but that will be icing on the cake as they will throw down a big "wow factor" incentive to stockholders who will leave Cookie haters like me in awe of his power and strength as a CEO.
    11 Mar 2013, 04:56 PM Reply Like
  • They're going to buy Samsung, close it down and send their chairman to jail where he belongs for fraud and theft.
    11 Mar 2013, 04:57 PM Reply Like
  • rperson,


    I like the way you think.
    11 Mar 2013, 05:21 PM Reply Like
  • Thanks Jack.
    11 Mar 2013, 05:27 PM Reply Like
  • Another jealous Apple fanboi. Luckily the courts of the world are made up of more objective people
    11 Mar 2013, 09:00 PM Reply Like
  • Dude. The Korean courts found him guilty. Your peeps bud.
    11 Mar 2013, 09:49 PM Reply Like
  • Excuse me. Ex-chairman Lee kun Hee. In the Korean papers referred to as the reign of corruption. The only reason he is the Ex chairman of Samsung is because he is so bloody, blatantly guilty even the Koreans had to convict him. Interestingly, for fraud and embezzlement. Apparently corporate executives in Korea are never found guilt of stealing, copyright and patent infringement.
    11 Mar 2013, 09:57 PM Reply Like
  • Samsung is a dirty company. Apple should never have done business with them.
    11 Mar 2013, 11:44 PM Reply Like
  • Agreed Rperson,


    Just like what needs to happen to Apple for stealing then repackaging as their own many of the "innovations" that they sold at hyper-inflated prices.


    The following quote from Anthony Wing Kosner's article titled "Napster Was the Hawk and Apple the Opportunistic Eagle" [Forbes. November 30, 2011) aptly describes Apple's means to an end:


    "The eagle, [Ben] Franklin points out, is ‘a bird of bad moral character. He does not get his living honestly. . . . He watches the labor of the fishing hawk; and when that diligent bird has at length taken a fish, and is bearing it to his nest for the support of his mate and young ones, the bald eagle pursues him, and takes it from him.’ Truly, a one-per-cent kind of bird."


    Without Jobs around to bully the global supply chain to follow his every whim, it seems that reality has partially struck. The true genius of Apple has been their accounting and marketing. It's cool though, that's business and Apple and Samsung played it to the hilt.


    12 Mar 2013, 04:03 AM Reply Like
  • Apple beats Samsung as top U.S. mobile phone vendor in Q4 2012 (Video)

    12 Mar 2013, 10:22 AM Reply Like
  • The important point is to get rid of a sizeable amount of cash. All methods, or combinations, are good.


    The point is that all that cash and liquidatable assets are attractive to corporate vultures. Allows them to borrow and to use the company's cash to pay back the lenders. Don't think it can't happen. At the least, all they need is the proxy of a large number of disgruntled stockholders plus the support of some large blocks.


    Evil is forever busy !
    11 Mar 2013, 05:22 PM Reply Like
  • 1. No special dividend, please...Pretty please! Look no further than Microsoft's biggie special dividend that heralded perma-flatness in their shares--ultra-dead money--apparently forever, and was viewed as a desperate move by a giant weak-kneed name.


    2. What is the logic behind buying back shares? To effectively increase the PE? With a ridiculously low PE already nearly half of many huge and successful corporations, and one tenth of Amazon's--how could buybacks possibly elevate Apple's share price? Currently, the investment community is manifestly PE-blind!


    3. I want to be proven wrong....Show me vast increases in share price demonstrated by other corporations--even outside of forward-looking cultural spear-tip growth-type names--consequent to buyback programs. Help me understand how it will help by pointing out successful programs that have benefited shareholders in this last 5 year period.


    And a huge AAPL buyback program is theoretically ALREADY in force, and should be logically supporting the stock all through this period of sagging stock price--or AAPL's internal financial management is asleep/flat stupid.


    4. Apple is the prime breakthrough innovator on the planet--it must launch an innovation in order to re-spark investor excitement. Anytime would be a good time--but sooner would definitely be better!
    11 Mar 2013, 05:26 PM Reply Like
  • Launch ANYTHING,!!!!... Pretty please!!.. But something new!, not larger, faster etc. etc, even a iPencil ! But do SOMETHING NEW!
    12 Mar 2013, 12:55 AM Reply Like
  • the rumor was that INTC is in contract with Apple.
    11 Mar 2013, 05:39 PM Reply Like
  • special one time div'd is ideas are to buy back 30-50 billion worth of stock with a "dutch auction" cleans the deck of loose stock,weak sellers and doesn't eliminate a higher div'd going forward......raises earnings / and shareholders benefit
    11 Mar 2013, 05:40 PM Reply Like
  • The stock is trading steadily after hours, around $437, in other words holding it's gains.


    Anything that gets the share rising will be welcome..whether it is a special dividend or a buyback...after all the analysts who were down grading today will be rushing to upgrade tomorrow, singing the praises of Apple and the short sellers will cover and the squeeze will push it high and for once we will enter a virtuous circle which hopefully will continue as long as this irrational sell off has done. Like a broken watch the market will be right eventually.
    11 Mar 2013, 05:40 PM Reply Like
  • ... And we only have to wait until Tim Cook open his mouth and Crashes the Stock... Yet AGAIN!!!... He's becoming an expert on doing so!
    12 Mar 2013, 12:50 AM Reply Like
  • if they increase regular dividends that will be like 3hrs energy bar for aapl. it will bust the berish of this stock. also may be they should buyback for $499 @ share.
    11 Mar 2013, 05:40 PM Reply Like
  • Volume always leads the way. Split the stock and up the div to 3 percent and you will see a hugh spike up. $500 for sure.
    11 Mar 2013, 05:40 PM Reply Like
  • Agree. Time to bust the bears and those F'kng short sellers who play the stock like their personal yoyo. Split it 10-1 and the shorties have to go and jerk off some other stock all day long. Give those jerks something o do besides tweet each other all god damn day. How about Google for a change?
    11 Mar 2013, 08:03 PM Reply Like
  • Like your comment
    12 Mar 2013, 01:23 AM Reply Like
  • 336 000 shares just traded at 4.37 E.T at a price of $437.87.


    So much for the million $12 lower!!!
    11 Mar 2013, 05:40 PM Reply Like
  • I did correct myself earlier on mistake of $12 . But there were the trades at ~4:03 that I was referring to.


    Not to worry, it's down $6.50 as of 10:46, but if you want to quote the price at a different time, I'm sure you can come up with a different price.
    12 Mar 2013, 10:49 AM Reply Like
  • what a desperate move. no use, aapl bulls. this stock is heading to $250.
    11 Mar 2013, 05:40 PM Reply Like
  • I'm not sure that Apple can do anything on dividends that would move the stock. Institutions are putting their money elsewhere. Until the institutions decide Apple is a better opportunity it's going to be slow going.


    I'm watching for money to start leaving AMZN and GOOG and hoping that money flows back into Apple.
    11 Mar 2013, 05:52 PM Reply Like
  • Patience, peeps.
    11 Mar 2013, 06:55 PM Reply Like
  • If was a Apple stakeholder I'd much prefer an acquisition but at the current inflated market prices add 30% good will and your overpaying. So if they made an acquisition right now it'd be an unknown which won't be accredited to earnings near term so that won't help the share price. Special dividend would be dumb and only beneficial to the traders who would be out of the stock when it tanks post ex date. Buyback would help but if fundamentals don't improve they'd be right back here soon enough.


    Best option in my mind would be simply using it for R&D, if you believe in the company buy it if you think its too cheap
    11 Mar 2013, 06:58 PM Reply Like
  • I am in agreement with the general consensus here, a special dividend will not be prudent for the company (from a tax stand point), and to shareholders.


    Alternatively, a stock buy back from AAPL will signal to the market it thinks the shares are cheap and will put a floor on the shares.
    11 Mar 2013, 07:35 PM Reply Like
  • Floor.........?! These thing looks that's it's going Straight to HELL!! It will be like the First Stock in history that it would go Negative! (Sarcasm...)
    12 Mar 2013, 12:46 AM Reply Like
  • I do agree that AAPL is still trading within its downward channel, but the RSI (14 day) and MACD suggest otherwise. I'm expecting Wednesday retail sales to be good, short-term bullishness on RSI, and 'buy on rumour, sell on news'. I'm suggesting this thing can pop 450 this week.
    12 Mar 2013, 01:05 AM Reply Like
  • Apple has more than 100 billion cash in hand and is earning tens of billions annually and has very little R&D or capex(less than 10 billion).


    Apple sure can spare a few ten billion to do something for shareholders without jeopardizing any business outlook.
    11 Mar 2013, 07:56 PM Reply Like
  • Kass, then Gartman. Is there anyone NOT daytrading Apple? :)
    11 Mar 2013, 09:16 PM Reply Like
  • Kimboslice and some others have suggested that in the grand scheme of things, it does not matter when the extra dividends come or when when they buyback stock and so on. Yes, it is so. But not everybody can hang on to AAPL when they rode it all the way from, say, 100 to 705 or 400 to 705, if it starts falling the prudent thing would be to protect the profits. If AAPL management appreciates the pain of sincere and faithful shareholders, then it is their duty to alleviate it as much as it is feasible, given the long term needs of the company. With such a huge cash pile, AAPL management ( Board) could have have been compassionate and helped the shareholders with enhanced buyback and increased dividends. Of course they could have split the shares to invite larger participation, but that could be a double edged sword. $2 drop after a 10 for 1 split is equal to a $20 drop pre-split.


    But I do strongly feel that AApl Management should not have waited this long to allow more than $250 drop in price. Many seasoned Chairmen/CEOs make it a point to "manage" the stock price to the extent possible in a legal and decent manner through appropriate action. Steve Jobs gave scant respect for stock prices in the market, but he was not right . He would have been a greater CEO had he respected the market movements.


    I think Tim Cook, who is no SJ, will prove to be adept in managing the business, but in the manner of appreciation of faithful stakeholders, he is GUILTY as being charged.
    11 Mar 2013, 11:30 PM Reply Like
  • Or a "Friend" of him is shorting the Stock!!!
    12 Mar 2013, 12:41 AM Reply Like
  • Seasoned CEO or not, Buffet too let Berkshire have its beatings. Four times, as far as I remember, with pullbacks of as much as 40-50%.


    13 Mar 2013, 05:20 AM Reply Like
  • Aapl is no brk
    13 Mar 2013, 06:43 AM Reply Like
  • ChopShop,
    We are talking B shares on BRK, true, AAPL is no BRK. It is the most innovative (See recent Court Decision awarding AAPL $1 B as in billion in copyright infringements from SS) company in my lifetime... so chopchop, even BRK can't claim that and I am a big Warren Buffet kind of guy. Did you bother reading Warren's conversation with SJ telling him not to change anything?
    13 Mar 2013, 01:38 PM Reply Like
  • APPLE Stock, it's now like an UFO, only moves UP when a rumor start's... And it crashes when TC or Agent Scully does not see it!, or makes a speech...
    12 Mar 2013, 12:36 AM Reply Like
  • the last thing they should do is a stock split, the one thing Apple just does not need is for yet more Longs to pile in, the freaking stock is here because of all the Longs.
    i think they should do absolutely nothing and stick to their announced plan a year ago and just bring that new iPhone, maybe pay out a one off special dividend as they are pressured to do something.


    the stock has an unique opportunity to shake-out all weak Longs, the last thing it now needs is to prop-up the share price, so that all who are just a few $ away from giving up are now holding on.
    clean the stock, so we can have a long term , gradual uptrend for years to come.
    if the stock is now being propped-up, it will go up 50 $ and end up lower.
    i'd rather see the stock drop some more , shake the longs, get some shorts in there and see the price going up for the longer term.
    it is absolutely frightening to hear that so many are still hanging in there, all looking for a quick fix.
    12 Mar 2013, 01:01 AM Reply Like
  • TIM COOK on a special Speech Tomorrow... He would say that the board is thinking about doing something, and would have some results by 3013... And investors don't have to worry anymore "the new stuff" is coming... By 3090... Remember dear investor we focus on the Long Term... Until then Major Upgrades!!,.. Colors, Button on other sides, logo in other position, volume control with new signs... Etc.. Etc.., I'm no apple Heater or Bear I'm an Apple investor,.. But Apple it has been treated Bears and Shorts better than any other Co. For the last 5 months!!
    12 Mar 2013, 01:17 AM Reply Like
  • I would take an increased regular dividend over buy backs or one timers everytime
    12 Mar 2013, 01:24 AM Reply Like
  • As an individual investor of long-time standing, my outlook is not optimistic. If a buyback were to take place, it should have a time-ownership factor. My personal future, on the verge of becoming the present, will have a significant disappointment because I am suddenly worth so much less.


    Hard to believe that this came about because of a 4% shortfall in one quarters sales projections after such a knockout record.


    12 Mar 2013, 01:36 AM Reply Like
  • no, that is just one of the arguments being used by analysts to try and justify the drop.
    the real reason for the drop is that the stock just ran ahead of itself, no company has achieved what Apple did, it went in 5 years from a 70 bio mkt cap to a 700 bio mkt cap and at that level people were yelling for the 1st trillion company ever, hence everybody pilled in to the stock, you want to be in stocks buy Apple, that was the message.


    this is the correction is not based on numbers or company performance or company outlook, this is pure punishment for having gone up too fast with far too many people on board.
    this is the much needed shake-out, the cleaning and it would be a terrible shame to intervene now artificially this process, please leave the stock alone, let it clean itself.
    we will all have a much better and healthier stock, it will stabilize, push out some more Longs and then establish a nice uptrend.
    this is a phenomenal company, the best we have ever seen, patience, give it time to heal.


    long Apple and buy on dips and may all the mad money men get out.
    12 Mar 2013, 02:02 AM Reply Like
  • @wiesje


    If the company fundamental can continue to support the price of Apple, why is Apple trading so low?


    The obvious reason is that the board and the management of Apple does not really care about shareholders of Apple.


    If they really care about the shareholders, they would have acted and at least Apple would not fall all the way down to unreasonable valuation of now.


    It says more about the board and the management of Apple, than how many people buying Apple.
    12 Mar 2013, 02:05 AM Reply Like
  • @ FreedOm : you know that is not true, i understand people are frustrated, they are long the stock above the market, they see these fantastic numbers, this cash pile and the stocks behaves like shit.
    but is not fair to blame the Management, they are running a company, the largest in the world, they also need time to adjust, this happened all in 5 years not a 100 and 3 mergers like Exxon, so give them time, the Board has not disappointed, they have kept all their promises, the only thing they have no influence over is the short term price behavior of the stock, but this sell-off , be it big , is just a correction, it's not a reversal of the fortunes of the company.
    one must be insane to bet against Apple the company, but yes one can bet against the stock price for a while, that's OK, that's all part of the game.
    believe me patience , the company over time will look after the stock price, it will go up and the Management will look after the cash and that will keep on pouring in.


    see it this way, we are all blessed that we are able to buy the best company in the world at 430$, this is a hand out of heaven, but you have to see it to take it, by the second half of the year this will all look very different, Apple will have launched some new products, the cash comes in and the stock will be well on it's way to 500.
    it is the best buy on the Board by far, i sincerely believe that, share holders will be rewarded very nicely, but it will take time.
    Long Apple and adding on dips.
    don't look to close at the screen, take a bit of the helicopter-view, if you held on for this long, you can also wait.
    the stock is bottoming, be patient and let's also be patient with the Board, these are extremely competent people, the employ the best brains.
    12 Mar 2013, 03:02 AM Reply Like
  • @wiesje,


    Thanks for the long reply.


    Apple has more than 100 billion cash on hand. How much does Apple spend on its R&D and Capex? slightly more than 10 billion last year(it was the most in the last few years). In the meantime, Apple was getting more than 40 billion cash from its operation.


    Any competent management or board can spare a few ten billion dollar to reward shareholders through higher dividends and share buyback and at the same time, help the share price.


    It is not that Apple in great need of cash, but not having it.


    My conclusion is simple. The board and the management is not shareholder friendly. I would not be surprise to see lawsuit against the board and the management about their fiduciary duties to Apple shareholders.
    12 Mar 2013, 03:10 AM Reply Like
  • @ freedOM, You do have the freedom to trade out of AAPL, I think this is the point that wiesje is making, and I agree on. Nothing obviously is "obvious" otherwise we would not all be talking this line. It is funny however that AAPL continues to be the MOST misunderstood issue, outside of AMZN to most individual traders, especially those that came in late to the runup party.
    13 Mar 2013, 01:46 PM Reply Like
  • so are most of people bailing out AAPL fools? the market has spoken. It does not like AAPL at all.


    Though I respect contrarian's idea, from 700 to 400, the market knows better than contrarian.
    13 Mar 2013, 07:25 PM Reply Like
  • @ freedOm : i think ( i am not in favor though ) Apple will pay a one off special dividend and then back to their original plan, which may look a bit mean with all that cash in hand, but which to me is fine.


    i also think we have no clue of what is brewing in Apple's " think-tank", i think they have a 5 year strategy that will blow Samsung and GoogLe away, but they will not be pushed and that might come across as arrogant, but it is not, it is strategy and that will require so much cash and they have it !
    Apple will dominate and develop so many different products to simplify and improve quality of life, we can't even imagine what is coming at us in the coming years, Apple will diversify, but all and this is the beauty and a super strength in affordable products, it's selling iPads and iPhones not Ferrari's, everybody can own it and afford it.
    this company is so bullish, it's a question of timing, not of price.
    anyway that's my view.
    12 Mar 2013, 03:27 AM Reply Like
  • @wiesje,


    with all due respect, from what you have said, I feel that Apple management is not good at capital allocation at all.


    How could competent management not be able to manage their cash flow to match their spending, instead, they need hold hundreds of billions in cash? I haven't seen a worse capital allocator than this.


    It's not about product, or operation. It's purely capital management.
    12 Mar 2013, 03:48 AM Reply Like
  • let's look at fact not assumptions:


    - most of the cash is off-shore to bring that back to the US at present would imply a 35% tax rate, Apple is negotiating a tax break, i am sure if they come to an agreement with the authorities a lot of that cash comes home, so far they are doing all share holders a favor not bringing that cash home.


    - they are investing that cash in the most prudent and secure way, the fact is that generates low return, but i for one would rather see them be cash hoarders than risk managers.


    - the cash pile has only really grown the last 3 years, they need to get to grips handling that


    - as a share holder buying in to Apple's present weakness, the cash pile gives me a great level of comfort buying the stock


    and what do they need for developing the products which are now in the "think-tank" , on outsourcing for R & D ( outsourcing, that's not internal ) they spent 7 bio a year, that can easily double in the coming year.
    Apple is aware of the " country-risk & counter-party risks " they are running at manufacturing in China and Taiwan, for new products coming out of the " think-tank" they are unlikely to further increase their exposure in China or Taiwan, they will need to find/establish/build factories in the Philippines, India, Indonesia and the US, they will geographically have to hedge their bets, the safest is the US, but also the most expensive. that will eat away 2/3rd of the cash they have, and also of the cash that will come in, but they are likely to be the 1st trillion company in 5 / 7 years ...
    sorry, i am not going to be persuaded otherwise, unless i see Management screw up and they have not, on the contrary they are handling this huge, huge company which is still expanding in a very professional way.
    i will not sell this Management short, just because they refuse to prop the share price up for short term gain and long term pain.


    they are not share holder unfriendly, what would you like them to have done.. shout at 700, people please don't buy the stock, this is crazy..?


    nothing personal, but i am afraid we both like this company for different reasons, but hell our goal is the same. good return on the stock.
    good luck, best regards.
    12 Mar 2013, 04:11 AM Reply Like
  • @wiesje


    Buffett investing into IBM says a lot about capital allocation. IBM is not only good at execution, but also good at capital allocation. On the contrary, Apple lacks of that.


    IBM, similar with Apple, is having huge amount of cash offshore. So did IBM not spend money on its dividends and share buyback in the U.S.? There are many ways to utilize cash offshore. You can borrow against it, like many companies such as IBM/Microsoft, etc are doing.


    Also, I don't see Apple is spending a lot on R&D or Capex, so to say it is holding 100+ billion cash for the future is simply lying.


    The way I see share buyback is not to prop share price in the short term, but to realize shareholder value. Apple is simply too cheap @400 with its cash holding and cash generating ability.
    12 Mar 2013, 04:33 AM Reply Like
  • i enjoyed exchanging views with you and i know you have a point on the cash, i just see it in a different way, i don't want to see Apple borrow cash for dividend of stock buy-back, Royal Dutch Shell is doing that for years and gives already for years 5% dividend return, but very little joy on stock value improvement.
    what's the point if Apple's off-shore cash generates 1% and they have to borrow at 1,5% to please share holders.
    but as said before, i feel they will pay a one off dividend.


    i hope there will be no additional share buybacks, i do not want the "mad money men " or " hedge funds" to come back into the stock.
    i am looking for a gradual but long term uptrend, it will come and it will be for the long haul.
    every year 50 to 100$ on the share price and bingo in 5 @ 7 years one trillion here we come and now with just devoted share holders on board, patience , it's going to give you that nice residence on the Keys. ( and for all those believing in Samsung that's also going to provide you a nice residence just south of the Keys, called Cuba)
    12 Mar 2013, 04:54 AM Reply Like
  • if they want to give some money away like a gift Apple needs to do the special dividends, as many people just will buy the share for it then sell it again so share down again. so simple, its better jut to increase the regular dividend and invest in R&D.
    I believe in the company and the level of the stock is just speculation because of the analysts who they do not know how to run a business and see that apple is not just phones and tablets its a concept and an industry as many other companies make products as gadgets, even the auto industry does and advertise that they have their automobiles ready for iPhones, iPads, iPods they never say Galaxy or androids, so just think this company is far to go down or disappear,come on give me break.
    12 Mar 2013, 05:48 AM Reply Like
  • Apple absolutely needs to quickly come to terms with China Mobile.
    12 Mar 2013, 06:21 AM Reply Like
  • Appears as though the rumor mill is rearing its ugly head once again...the bears don't believe the stock should be where it is...pump in some media, ride the wave until real news breaks...then watch the sell-off. Seems like a trend.
    12 Mar 2013, 06:57 AM Reply Like
  • apple should rather do a special dividend where there is a year between the record date and pay date and the dividend is only paid to the person if they still own the shares in a years time!
    12 Mar 2013, 07:01 AM Reply Like
  • I am fine if the stock price drops, then I can average down
    12 Mar 2013, 07:21 AM Reply Like
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