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Apple increases dividend by 15%, boosts capital return spending to $100B through 2015 - Page 2

post #41 of 88
Quote:
Originally Posted by SolipsismX View Post

Cook said they will pay out about $10 billion in dividends per year now. Add to the $60 billion / 3 years = $20 billion per year in buybacks is $30 billion per year from their profits. That just seems crazy.

To put that in perspective, Facebook is a $60B company.  This just goes to show how much cash Apple is generating. 

post #42 of 88
Quote:
Originally Posted by tribalogical View Post

 

 

Or, it is exactly enough...

 

Wait… "are" going to vote Cook off the Island? Well first of all, Shareholders don't vote for CEO. They vote for Board Members who then appoint/fire officers. It'll be a cold day in hell...

 

And "distributed over several years" makes it sound long and unpalatable. What's wrong with simply pointing out the facts? The end of FY 2015 is… when? Do the math… yah. Is that "several years"? Really…??  How about "roughly two years…" Then it becomes a good, careful pace for buying back SIXTY BILLION dollars in shares. Anything faster would artificially inflate the stock price, and then you'd have something ELSE negative to say, for sure...

 

What's your agenda here?

Agreed. And to add to your point, Apple wants to have the liberty of buying back the shares when they want so that they can buy wihtout disrupting the market. I'm hoping Cook can buy all those shares back shares at below $400 or even better yet at $330, which is my basis in my Apple shares.  

post #43 of 88
Quote:
Originally Posted by Jetz View Post

 

From now till 2015?

 

So basically, they aren't reducing the cash hoarde at all.  They are just growing it slower.

 

From an investor perspective, AAPL and MSFT are slowly starting to converge.  MSFT investors too, thought their stock would rebound.  It never did.  Instead, MSFT stabilized in a new trading range and became a blue chip dividend stock.  Real risk that this is what will happen to AAPL if there are no blockbuster new products on the horizon or the board isn't interested in returning money to shareholders.

 

WILL happen… if, and if, and if and when and if……. I mean, look at Microsoft!!!

 

Seriously, man… look at Apple. That's who we're talking about, and I see none of the same illusions that you do.

 

I'm fine with Apple having a cash reserve (I prefer "reserve"… from a business perspective, that's a healthy thing to have. "Hoard" is a word with negative connotations used by people who just want more of that pie for less invested)...

 

You keep speaking "from an investor perspective"…. but, as an investor, my perspective isn't at all like the one you claim to know everything about.

 

From MY investor perspective, 2015 is only 2 years, and that's an excellent, conservative pace for a share buyback of this magnitude. It keeps the options open and maximizes possible results (while minimizing disruption). It's fine with me that they aren't DRAINING the cash reserve, but enacting a capital return that makes sense and keeps the reserves healthy. Meanwhile, they're increasing my dividend another 35 cents a share which is about what I expected. Actually 5 ~ 10 cents higher than I expected (I expected a 25 ~ 30 cent increase).

 

From an investor perspective, I have little to complain about, other than the artificially low value of the stock at present, and I don't blame Apple management for that. Something tells me that's about to change, however. Up up and away…….

post #44 of 88
Quote:
Originally Posted by Jetz View Post

 

Wait.  So the entire framework for capitalism is bunk and investor concerns are entirely irrelevant beyond a certain point in time?  Interesting.  Why doesn't Apple put that in its disclosure?

 

Sorry, but whether you like it or not, last I checked, Apple is a publicly listed company and as such they certainly have to respond to shareholder concerns.  If they don't want to inconvenience themselves with something so bothersome, they are free to buy us out and take the company private.  Would be interesting to see Apple follow Dell's precedent!

 

Yeah, blah blah blah.  Capitalism **** Yeah! etc. 

 

You're already attempting to answer every post in the thread all by yourself so I'll just let you continue.  You're wasting yours, and every else's time though.  

 

Here for example, you haven't even addressed my argument, just put words in my mouth that I didn't say and pushed out some more dogma about stuff that I wasn't even talking about.  

 

Can you actually hear anyone but yourself?  The only people that care about what you're saying think you're completely wrong.  What does that tell you?  

post #45 of 88
Quote:
Originally Posted by Jetz View Post

 

I get the argument.  Heck, I thought that too as I watched Apple go through $700 and crash through my position at $580.


But here's the thing about P/E.  It's based on market sentiment about whether or not the company is going to grow or is able to generate income going forward.  The iTV rumours keep advancing by a year every year.  No new products, while Apple faces commoditization on its existing products and outright hostility to the idea of returning cash, is bound to keep investor sentiment negative towards Apple's P/E.

 

I picked up some AAPL today, before the announcement.  I think the stock is ridiculously cheap.  But I won't lie.  I am very fearful that AAPL may well settle under $500 for years to come and I'll either have to eat my losses or wait a very long time for the $3 dividend to make up for it.

 

Wait a minute... in your previous post you went all macho about investments not being "emotional", then in this post seemed to be basing pretty much all your perspective on emotion (and fear) and what I'd point to as supposition and false narrative.

 

I remember when Apple was at 580. I wouldn't have bought in at that particular point. Why did you? And more importantly, how emotional a decision was it? (I'm speaking of the opposite emotion known as "irrational hubris"). This isn't an 'attack' by the way… a real question.

post #46 of 88
Quote:
Originally Posted by Tallest Skil View Post

 

So here's your question: Why didn't you sell at $700?

 

 

It's a good question. On the way back down I would have certainly sold around $640, give or take, if I had bought in at $580… 10% is a decent return on a short turnaround. Once it tucked under $600, I'd have been sold out and sitting in a wait-and-see orbit...

 

Unless we're talking about 100 shares… then, I don't know if it warrants discussion...

post #47 of 88
Quote:
Originally Posted by majjo View Post


I wouldn't call the drop unfounded though. We had the maps (PR) fiasco, followed by execs dumping stock, followed by execs leaving, followed by a lower profit margin. Taken together, I can see why people would be fearful, especially after a huge run up.

 

I would certainly call the drop 'unfounded'. After almost two years of record revenue growth under Cook, including the period in question (where the stock price dropped by $300 : 45%), with all the numbers looking pretty great, especially when taking broader markets into consideration (it's easy to forget that Apple has been giving us this extraordinary financial performance throughout a prolonged global recession and ongoing economic weakness).

 

The Maps "fiasco" isn't the first thing Apple has ever misfired on (under Jobs we had a fair share of those), and it shouldn't have any measurable impact on stock price, much less a 45% effect. After all, did the "fiasco" with the .mac rollout cause a major dip in stock value? Nope…).

 

"Execs dumping stock" overstates the situation to a huge degree. I'm sensitive to that stuff, and did NOT see it that way at all. (Check Microsoft in the same period, however… m-hm...)

 

"Followed by execs leaving"… um. What...? Do you mean Ron Johnson leaving for JCP? Or Forstall and Browett (a "shakeup" that was required in my view)? Reality check: three people does not an 'executive exodus' make.

 

"Lower profit margin"…? Erm… you can't be referring to the mild fluctuations in overall margins alongside significantly higher revenues resulting in immensely increased profits? That's what we're used to seeing with Apple, and those fluctuations are NEVER an issue… are you parroting some MSM 'analyst' talking head or something? TODAY is the first time in TEN YEARS that the company has seen REDUCED profit margins.

 

This is not a LOSS either, merely a very slight reduction in the level of margin. Not showing growth for ONE quarter, for the first time in ten years does not a profit exodus make either. 

 

In the end, that was quite a list you came up with, most of it not very relevant in fact...

 

 

This is a company that learns from its mistakes, identifies and fixes problems, and always comes up with results beyond expectation. I can't slight them in the least. That said, I buy and sell their stock mostly according to how I think the market will perform, and not based all that much on Apple's corporate/financial performance. Those don't correlate well and often. I pay more attention to "market sentiment" to judge my buy/sell cycles… 

post #48 of 88
Quote:
Originally Posted by OriginalG View Post

$60B amazing, that's a huge number. Is this local, non-foreign cash?

 

Yes, combined with borrowed funds apparently. 

 

I wish they could repatriate their offshore funds more affordably. I'd love to have more of that cash circulating in our domestic economy...

post #49 of 88
Quote:
Originally Posted by SolipsismX View Post

Buying back $60 billion in shares. I can't wait to see how people put a negative spin on that.

That's a great number. At today's prices, that's about 15% of Apple's outstanding shares.

If Wall Street starts to act logically, for a change, taking 15% of shares off the table should result in a 15% share gain - even without considering anything else.
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post #50 of 88
Stock essentially flat after hours. Lot of good dolling out the cash did. 1rolleyes.gif
post #51 of 88
Quote:
Originally Posted by jragosta View Post

That's a great number. At today's prices, that's about 15% of Apple's outstanding shares.

If Wall Street starts to act logically, for a change, taking 15% of shares off the table should result in a 15% share gain - even without considering anything else.

it would be great if they could spend $60 billion of that $147 tomorrow on the buy back. I know it can't happen but it would be a great way to boost the stock value and say FU to Wall Street.

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post #52 of 88

Maybe instead you should cry all YOU want.  Your goals as an investor are not necessarily the goals of all other investors, and as someone who, less than a decade ago, bought in at 85 a share, I'm STILL flying on cloud nine, having more than sextupled my money.  I'm in for the long haul, and like me, there are more investors out there who understand the stupidity, arrogance, and emotional response of short-sighted, short-term investors and day traders in the marketplace, hence, we do not "lose our shit" if Apple drops from 700 to 350 in under 12 months when their fundamentals are so clearly superhuman.

This is how it is with Apple.  We in for the long haul know where its going, and we're patient.  We who are in for the long haul understand that short-haulers cause these kinds of fluctuations and we sit calmly through them, just like we did in 05, 08 and now 2013.  You who are in for the short term should perhaps consider finding another game to play if you can't handle the truth of the marketplace.

You aren't qualified to criticize Tim Cook yet.

post #53 of 88

Can somebody explain the "borrowed cash?"  Why would Apple borrow cash?

post #54 of 88
Quote:
Originally Posted by Rogifan View Post

Stock essentially flat after hours. Lot of good dolling out the cash did. 1rolleyes.gif

See what happens between now and the 13th of May.  You never know what the market will think tomorrow.

post #55 of 88
Quote:
Originally Posted by SolipsismX View Post

Buying back $60 billion in shares. I can't wait to see how people put a negative spin on that.

 

There is no negative spin.  This is what everyone who is bearish on Apple was suggesting and hoping they do.  It won't get them back to 700, but it is a way to return capital to investors, which is the end game for any corporation....

post #56 of 88
Quote:
Originally Posted by Rogifan View Post

Stock essentially flat after hours. Lot of good dolling out the cash did. 1rolleyes.gif

 

After hours performance isn't a great indicator, since most people don't trade after-hours...  And historically, after-hours performance isn't a great indicator of what will happen in the next trading session.  

post #57 of 88
Quote:
Originally Posted by Mikeb85 View Post

After hours performance isn't a great indicator, since most people don't trade after-hours...  And historically, after-hours performance isn't a great indicator of what will happen in the next trading session.  
This quarter it was for Google, Netflix and Microsoft. They were all up big after hours and closed that way the next day. My guess is Apple will be flat tomorrow. And the "analysts" will fret about the June quarter and no new product announcements anytime soon. Would be helpful if Apple announced WWDC this week.
post #58 of 88
Quote:
Originally Posted by echosonic View Post

Can somebody explain the "borrowed cash?"  Why would Apple borrow cash?
Because most of their cash is overseas and it would be cheaper to borrow than repatriate the cash and pay 35% (or whatever the rate is) tax on it.
post #59 of 88
Quote:
Originally Posted by Jetz View Post

Cry all you want.  Investing is about money, not emotion.  I like Apple products. I own several.  But if I got a shareholder ballot tomorrow asking me whether Cook should be voted off, I'd vote yes in a heartbeat.  As a shareholder, I don't give a fig about Apple products.  I care about what he's done for my AAPL stock. Bupkis.

And I'm not one of those people who bought at $700.  Were I one of those, I'd be calling for his head on a platter.


My personal regret is not dumping my position at $700 and believing that this board cares about investors to try and rally the stock back.

Where did he go wrong?
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post #60 of 88
Quote:
Originally Posted by Mikeb85 View Post

After hours performance isn't a great indicator, since most people don't trade after-hours...  And historically, after-hours performance isn't a great indicator of what will happen in the next trading session.  

The Nasdaq closes at 4 PM EDT which is 1 PM in California, I'd say a more than fair amount of trading happens 'after-hours'.
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post #61 of 88
Quote:
Originally Posted by 65C816 View Post

$50bil more in stock buy back? At 939 mil outstanding shares, that's $53/share.

Isn't this Tim Cook saying "**** you", in the most classy way possible, to Wall Street? 1smile.gif

This is style! 1smile.gif

There starting with 2 billion in buy backs this month, and plan to buy back 400mill shares according to Oppenhiemer, to push the stock to a more valuable level.

There not buying all of there shares back that would be extremely stupid.

post #62 of 88
Quote:
Originally Posted by SolipsismX View Post


it would be great if they could spend $60 billion of that $147 tomorrow on the buy back. I know it can't happen but it would be a great way to boost the stock value and say FU to Wall Street.

2 billion this month starting according to Oppenhiemer.  But I agree it would be a great big MIDDLE FINGER to wall street.1smile.gif

post #63 of 88
Quote:
Originally Posted by majjo View Post


 followed by execs leaving

?????   Ron Johnson left of his own accord to run JC Penny.  Not because Apple was in trouble,   Forestall was fired because he refused to admit that the maps problems were his direct responsibility  and because he played well with no one (one very particularly important person to apple in fact Jony Ive).  And Browett?  He was a dumb ass that tried to run the retail chain like walmart cost cutting and reducing workforce and causing all kinds of problems not because he was trying to help Apple but because he was trying to impress the management team by in effect saying "LOOK AT ME!!!! Im doing such a good job"

post #64 of 88
Quote:
Originally Posted by Mikeb85 View Post

 

After hours performance isn't a great indicator, since most people don't trade after-hours...  And historically, after-hours performance isn't a great indicator of what will happen in the next trading session.  

 

True enough. 

 

The crazy thing about the dividends (IMO) is that you can be an AAPL shareholder just one day before the dividend is issued, get the benefit, then sell the stock immediately. How in the world is that creating long term value for Apple?

Proud AAPL stock owner.

 

GOA

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Proud AAPL stock owner.

 

GOA

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post #65 of 88
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Originally Posted by Jetz View Post

Instead, MSFT stabilized in a new trading range and became a blue chip dividend stock. Real risk that this is what will happen to AAPL

You mean AAPL could have a P/E of 15.77 like MSFT? I take that risk!

post #66 of 88
Quote:
Originally Posted by Tallest Skil View Post

Then what's up with the emotional decision to screw Apple out of a couple hundred billion in market cap?


If it's about money, why, when the money says success, is everyone whining failure?

Sounds like it's the fools who sold that are "crying".




Ri~ght… 1rolleyes.gif




So here's your question: Why didn't you sell at $700?
The "Tim Cook can't possibly do anything right ever" crowd. 

Great post!
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post #67 of 88
Quote:
Originally Posted by Jetz View Post

From a shareholder perspective? Not enough. Stock will keep deflating.

Sooner or later the shareholders are going to vote Cook off the Island if they keep hoarding cash for no apparent reason. The buyback sounded good until they said it's distributed over several years.

Why would Apple buy back all it's shares at once? It should buy back over a period of time to improve the cost average of its shares.

Quote:
Originally Posted by Jetz View Post

Cry all you want.  Investing is about money, not emotion.  I like Apple products. I own several.  But if I got a shareholder ballot tomorrow asking me whether Cook should be voted off, I'd vote yes in a heartbeat.  As a shareholder, I don't give a fig about Apple products.  I care about what he's done for my AAPL stock. Bupkis.

And I'm not one of those people who bought at $700.  Were I one of those, I'd be calling for his head on a platter.


My personal regret is not dumping my position at $700 and believing that this board cares about investors to try and rally the stock back.

Perhaps Apple only cares about investors. You know the people who are in it for the long haul. Apple didn't tell people to buy its stock at $700. further it is fundementally the same company as when the price was at $700. Nothing has changed.
post #68 of 88
Quote:
Originally Posted by TBell View Post


Why would Apple buy back all it's shares at once? 

 

Apple can't buy back all the outstanding shares...  They don't have enough cash.

post #69 of 88
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Originally Posted by dasanman69 View Post


Where did he go wrong?

 

 

He didn't personally get on the phone to call Jetz to tell him to get out at $700. Or $650. Or $600. Or $585...

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post #70 of 88
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Originally Posted by Gazoobee View Post

Check posts by "jetz."  He's some kind of wall street weenie (or wannabe), that has a negative spin for almost every occasion.  1smile.gif

His name ends with a 'z', too. Red flag if there ever was one.

PS: I wish someone made a browser extension that could block posters from users much better than the forum software can. I mean actually remove the user related posts, not just hide the text part or let it show up when someone quotes them. I never bother with the ignore list due to that sec on part.

Quote:
Originally Posted by sennen View Post


He didn't personally get on the phone to call Jetz to tell him to get out at $700. Or $650. Or $600. Or $585...

Now you mention it he didn't call me either. Class action lawsuit here I come¡

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post #71 of 88
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Originally Posted by Rogifan View Post

Because most of their cash is overseas and it would be cheaper to borrow than repatriate the cash and pay 35% (or whatever the rate is) tax on it.
OK I understand that, but how will they pay off the new loan Stateside? With new revenue coming in? How will they ever use that oversea cash- will be in Foxconn or more Apple stores do you think?

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post #72 of 88
Thanks for the money, but couldn't you have saved it to buy Samsung?
(chortle)
post #73 of 88
@JeanDarch, don't Bogart that joint, my friend.

Next big thing from Apple has to do with a new network and a new way to communicate over it.

Very funny name. Do you think she was eating the bolond gomba?

Edit: Okay, I looked it up. Very Interest-ing. Starting with the glasses, who knows where it will lead?

I think Facebook will be replaced by . . . I'd better not say. Certainly face-to-face in real time . . .
Edited by Flaneur - 4/24/13 at 3:29am
post #74 of 88
According to CNBC stock is down $4 pre-market. So I'll say again, a lot of good this $100B in goodies did for Apple. Because the bad keeps getting moved. Wall Street was screaming for increased dividend and buy backs, which they got, now they're wringing their hands over possibly no new product in the summer. Even though Apple never made any comments or promises on when new stuff would be coming. This morning on CNBC they had a guest on who just started following the stock in November. He said Apple needs a low cost phone for emerging markets AND needs to keep up their high margins.

I thought maybe the goodies Apple decided to hand back would maybe stabilize the stock, or we'd even see a bit of an uptick. And maybe we will over the coming weeks. But I also wouldn't be surprised if we see the stock fall closer to $300 because Wall Street just plain hates the company right now.
post #75 of 88
Quote:
Originally Posted by igriv View Post

It's a great way to piss away money. Sort of like hitting yourself on the head, just to show "them".

It's not pissing it away it's reinvesting it. With that many stocks off the market it increases the value of the ones available.
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post #76 of 88
Quote:
Originally Posted by Rogifan View Post

According to CNBC stock is down $4 pre-market. So I'll say again, a lot of good this $100B in goodies did for Apple. Because the bad keeps getting moved. Wall Street was screaming for increased dividend and buy backs, which they got, now they're wringing their hands over possibly no new product in the summer. Even though Apple never made any comments or promises on when new stuff would be coming. This morning on CNBC they had a guest on who just started following the stock in November. He said Apple needs a low cost phone for emerging markets AND needs to keep up their high margins.

I thought maybe the goodies Apple decided to hand back would maybe stabilize the stock, or we'd even see a bit of an uptick. And maybe we will over the coming weeks. But I also wouldn't be surprised if we see the stock fall closer to $300 because Wall Street just plain hates the company right now.

Funny, just as I was reading that, the NPR "Marketplace" headline was,"Apple tries to please Wall Street."

They ended the story with Tim Cook's hinted Autumn surprise; the stock is now up $2.

We need an essay by somebody we can trust on the benefit of Apple's stock buyback. I'm going to start with Warren Buffet's recent advice.

I wonder if part of the logic is to reduce the percentage of speculative infestors. Oops, I meant investors. We have a few of those around here, or at least they claim to be.
post #77 of 88
Quote:
Originally Posted by igriv View Post

I was talking about buying it all in one day. Otherwise, the buyback is a good thing, though not as good as Einhorn's proposal.

They're not doing it all in one day. They're spreading it out over 2 1/2 years.
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post #78 of 88
Quote:
Originally Posted by igriv View Post

I was talking about buying it all in one day. Otherwise, the buyback is a good thing, though not as good as Einhorn's proposal.

Einhorn's proposal was absurd.

Preferred stock makes no sense. There's no real advantage to the company to having two classes of shares - it's simply a mechanism for Wall Street insiders to profit at the expense of individual investors.

Returning huge chunks of money via dividends is also greatly inferior to share buybacks. It simply creates tax problems for investors. For that reason, I didn't favor the previous dividend schemes and certainly not the increase in dividends. Apple is caving in to greedy Wall Street insiders who are simply trying to enrich themselves without any concern for what's right for the company.

And borrowing money so they can give it to investors is totally absurd. If you have cash and want to distribute it, that's one thing. But borrowing money to distribute it is an incredibly risky strategy which is not in the company's interest (nor that of long term investors).
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post #79 of 88
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Originally Posted by jragosta View Post

Einhorn's proposal was absurd.

Preferred stock makes no sense. There's no real advantage to the company to having two classes of shares - it's simply a mechanism for Wall Street insiders to profit at the expense of individual investors.

Returning huge chunks of money via dividends is also greatly inferior to share buybacks. It simply creates tax problems for investors. For that reason, I didn't favor the previous dividend schemes and certainly not the increase in dividends. Apple is caving in to greedy Wall Street insiders who are simply trying to enrich themselves without any concern for what's right for the company.

And borrowing money so they can give it to investors is totally absurd. If you have cash and want to distribute it, that's one thing. But borrowing money to distribute it is an incredibly risky strategy which is not in the company's interest (nor that of long term investors).

I never understood why one would care what tax rate they'd pay on free money. I'd rather have some of the free cash than none.
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post #80 of 88
Quote:
Originally Posted by jragosta View Post

And borrowing money so they can give it to investors is totally absurd. If you have cash and want to distribute it, that's one thing. But borrowing money to distribute it is an incredibly risky strategy which is not in the company's interest (nor that of long term investors).

 

You'd better hurry up and tell Tim Cook, because that's exactly what he said they're going to do.  

 

Most of Apple's cash is overseas.

 

It's a lot cheaper to borrow money at today's US rates, than to pay the taxes to bring that cash into the US.

 

Analysts say that basically, Apple is betting that there'll be a tax amnesty sometime in the future, and it'll all work out.

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