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Preliminary Apple proxy filing details Carl Icahn's $50B stock buyback plan up for shareholder vote - Page 3

post #81 of 140
Quote:
Originally Posted by ChristophB View Post


He reminds me of an old man I'd expect to see on The Muppets.

 

 

Quote:
Originally Posted by Cpsro View Post
 

(Photo taken in the weeks before Carl Icahn's bar mitzvah.)

You're both wrong...

 

 

Quote:
Originally Posted by AppleInsider View Post
 
Icahn
 

He's the Dos Equis "Stay thirsty, my friends" guy. :lol:

Why does Apple bashing and trolling make people feel so good?

Reply

Why does Apple bashing and trolling make people feel so good?

Reply
post #82 of 140
Originally Posted by jungmark View Post
And Icahn cant

 

Dah DAH, dat-dat-dat-dat dah dah dat-dat-dat-dat dah dah dat-dat-dat-dat dah-dah-dah-dah-dah-dah-dah-dah!

 

Oh dear, him in a tutu just flashed through my mind

 

Originally Posted by Dickprinter View Post

He's the Dos Equis "Stay thirsty, my friends" guy. :lol:

 

Originally posted by Marvin

Even if [the 5.5” iPhone] exists, it doesn’t deserve to.
Reply

Originally posted by Marvin

Even if [the 5.5” iPhone] exists, it doesn’t deserve to.
Reply
post #83 of 140
Since when is Paul McCartney crap.. There is a reason that the franchise is so valuable. It's income is the highest.
post #84 of 140
No Google purchased Calico
post #85 of 140
Quote:
Originally Posted by sog35 View Post

Would it be better to buy back the stock when it's $560 or when it's $700? At this rate Apple will be buying back stock all the way till late 2015 when the price will be much higher than now. All Icahn wants to do is accelerate the buy back and add $13B.

If Apple does not think it is a good idea to accelerate the buyback.do they owe the stockholders an explanation?
Also what training and background does Cook have in finance?
post #86 of 140
Quote:
Originally Posted by Flabingo View Post

If Apple does not think it is a good idea to accelerate the buyback.do they owe the stockholders an explanation?
Also what training and background does Cook have in finance?

He's the CEO of Apple. I think being the hand picked leader of the most valuable company on Earth counts for something.

Proud AAPL stock owner.

 

GOA

Reply

Proud AAPL stock owner.

 

GOA

Reply
post #87 of 140
Quote:
Originally Posted by SpamSandwich View Post


He's the CEO of Apple. I think being the hand picked leader of the most valuable company on Earth counts for something.

Cook is a good ceo.. perhaps very good, but he's not perfect.  

It's a non binding resolution.  Even if it passes or fails, he's not obligated to respond to it or act on it.  Having said that, I'm going to vote for it.  It makes a lot of financial sense, and even in the worst case scenario, I can't see any harm coming out of it for Apple.

post #88 of 140
Originally Posted by Flabingo View Post
Also what training and background does Cook have in finance?

 

Are you mental?

Originally posted by Marvin

Even if [the 5.5” iPhone] exists, it doesn’t deserve to.
Reply

Originally posted by Marvin

Even if [the 5.5” iPhone] exists, it doesn’t deserve to.
Reply
post #89 of 140
Quote:
Originally Posted by Marvin View Post

People keep saying $150b in cash. Their $150b is mostly in long term securities, which can fluctuate in value. They could take on more debt to finance the buyback and the value of their securities can drop. While they still generate lots more income every year, the ultimate aim is to increase the share price.

Investors talk as though the share price dictates the company value and if it's down, the company is struggling. The share price is determined by traders/gamblers and can go up or down regardless of what Apple is doing - Apple pretty much did nothing and it nearly doubled in less than 6 months. Apple could buy back a load more shares, release an iPhone 6 that traders aren't impressed with and the stock price doesn't move or moves very little. All this does is lose the company (and shareholders) a lot of money.

Apple is not undervalued at its current stock price. It has the highest market cap of any company in the world - 14% higher than the next company. Their profits aren't growing and they have hit the market limits.

The investors pushing for the buyback want the stock market value of their holdings to go up, it has nothing to do with Apple's best interest, it is for their own self-interest (shouldn't come as a surprise as this is the MO of stock traders).

It is true that inflation can slowly devalue Apple's securities but not if those securities increase in value - Apple invests its money for growth too. Having people with a profit motive (regardless of the effects on Apple) calling the shots is a bad thing for Apple's long-term interests.

Let's say that Apple doesn't increase the buyback and they sustain their revenue and margins for the incoming year. If Apple is undervalued, the market will push the stock price up anyway and Apple will have both lots of securities and a high market value.

If the market doesn't push the stock price up and Apple increases their securities without any plans to spend it, they can accelerate the buyback at that point because the stock price is still down and they have more assets to use.

There's no urgency to increase the debt, Apple is stable and very healthy. Any urgency comes from investors whose other interests aren't as stable and they need growth. Icahn is a major shareholder in Federal-Mogul which has a lot of staff and it or any of the other companies he invests in could require him to have money for certain business transactions:

http://www.businessweek.com/news/2012-12-03/carl-icahn-s-federal-mogul-seeks-to-extend-1-dot-8-billion-debt

The people who talk about Apple losing money by not doing a buyback speak of value in terms of the value traders put on the company, which is extremely volatile. Apple buying back a share doesn't give them an asset with assured growth, they are exchanging assets for something valued by traders. That doesn't mean it's pointless doing it at all as they can be given as awards to staff instead of assets and they can grow in value quickly when the company is undervalued but as I say, they aren't.

 

So you don't think Apple is cheap?  Really?

 

Its market cap is $500B.  Minus $150B in cash you get $250B sans cash.  Last year they made $37B in profits.  That gives you a PE ration of 6.75.  That is beyond cheap.  Total ridiculous.  Companies that are dying get higher PE Rations than 6.75.

 

Garmin - a company that rely's on a dying technology (stand alone GPS) has a 15 PE (over 200% higher than Apple after taking out cash)

HP - a dying PC company has a PE of 10.76 which is significantly higher than Apple

Hawaiian Electric - a friken utility company has a PE of 19

International Paper - 18.34

 

When you take out cash you can see how ridiculously cheap Apple is.  The reason is Wall Street is not give Apple any credit at all for their excess cash.  In fact I argue that they view it as a negative.

 

You say Apple invests its $150B for GROWTH. BS. Total BS. They have been returning 1% the last 3 years because the majority of the cash is in safe CD's.  If they had it in a index fund they would have returned almost $30,000,000,000 in 2013.  Thats right.  They would have almost DOUBLED their net income for the year. 

 

You said Apple almost double the last 6 months by doing nothing ( You are wrong, it went up 40%).  A big part of that gap up is the buyback program.  Earnings have not grown YoY but the buyback and dividend is attracting other types of investors.  An accelerated buyback in 2014 would help even more. 

 

"Their profits aren't growing and they have hit the market limits."  Really?  You conclude after ONE year of declining profits that Apple will forever stop growing?  Didn't you notice that profits shrank but units of iPhones/iPads exploded 25% in 2013?  And how do you know what the market limits are for products that have NOT EVEN BEEN RELEASED YET?  You do know Samsung sells 100,000,000 high end smartphones a year.  You don't think Apple could steal 20% of those sales and grow their iPhone profits by 20%? 

post #90 of 140
Quote:
Originally Posted by jungmark View Post


And Icahn can't make mistakes?

 

Icahn came from a family with modest means.  Now he's one of the richest men in the entire world.  I think he knows what he's doing regarding increasing shareholder value.

 

Tim Cook is a great COO/CEO.  But is their CFO really that great?  I'm not so sure.  Apple has tons of talent with creating awesome products and marketing them.  But I'm not sure if they know what the hell they are doing with capital allocation.  Having $150B of cash earning 1% is a major failure IMO.  They could have used that money to buy Twitter, Facebook, Nuance (company behind Siri tech and Google Now).  They have improved the situation with the $60B buyback but more is needed.   Unless they are planning on spending $100B in the next few years in acquistions/capital than there is no reason to hold $200B earning 1%.

 

The opportunity cost of $200B earning 1% is massive.  Even at a low 9% return they are losing $16,000,000,000 every year.  Why not distrubute that excess money if Apple can't do anything with it?

post #91 of 140
When Jobs died Apple was left without any entrepreneur, in management or on the board. In the next two months we are going to learn whether Apple is a growth company, or a wonderful safe investment for widows and orphans. The ball is in Apple's court., management is not going to change, but one or two board members could be a positive. How about Elon Musk?
When you talk to a good financial advisor, the first question is comfort and ability to invest in growth stocks.
It was only 18 months ago that Apple stock was higher than Google, now it is half. What happened?
The same management is at both places.
DOES it bother anybody that the chairman of the board of Apple, Arthur Levinson is the CEO of Calico, which was recently purchased by GOOGLE?
post #92 of 140
Quote:
Originally Posted by Flabingo View Post

When Jobs died Apple was left without any entrepreneur, in management or on the board. In the next two months we are going to learn whether Apple is a growth company, or a wonderful safe investment for widows and orphans. 

 

I don't know about the next 2 months, but some time in 2014 there will be a new product line.

 

From a strategy point of view, the interesting thing will be how Samsung reacts. Apple beat Microsoft, not with the Mac like everyone was expecting, but by redefining home computing with iDevices and then beating them in that market. 

 

Now we have the same situation with Samsung and their Galaxy devices. While everyone is watching iPhone vs Galaxy market share numbers, Apple may be planning to beat Samsung a whole different way.

post #93 of 140
Quote:
Originally Posted by SpamSandwich View Post

He's the CEO of Apple. I think being the hand picked leader of the most valuable company on Earth counts for something.

And I imagine that he will have at least studied corporate finance during his MBA.
post #94 of 140
Quote:
Originally Posted by sog35 View Post

Icahn came from a family with modest means.  Now he's one of the richest men in the entire world.  I think he knows what he's doing regarding increasing shareholder value.

Yes, that's the problem. Being good at increasing shareholder value isn't the same as being a good CEO.

Could be that Apple has a huge chunk of cash earmarked for something. Icahn doesn't know, and I don't see why Apple should tell him; his exposure ain't that great.
post #95 of 140
Quote:
Originally Posted by sog35 View Post

Icahn came from a family with modest means.  Now he's one of the richest men in the entire world.  I think he knows what he's doing regarding increasing shareholder value.

Tim Cook is a great COO/CEO.  But is their CFO really that great?  I'm not so sure.  Apple has tons of talent with creating awesome products and marketing them.  But I'm not sure if they know what the hell they are doing with capital allocation.  Having $150B of cash earning 1% is a major failure IMO.  They could have used that money to buy Twitter, Facebook, Nuance (company behind Siri tech and Google Now).  They have improved the situation with the $60B buyback but more is needed.   Unless they are planning on spending $100B in the next few years in acquistions/capital than there is no reason to hold $200B earning 1%.

The opportunity cost of $200B earning 1% is massive.  Even at a low 9% return they are losing $16,000,000,000 every year.  Why not distrubute that excess money if Apple can't do anything with it?

Quote:
Originally Posted by Flabingo View Post

When Jobs died Apple was left without any entrepreneur, in management or on the board. In the next two months we are going to learn whether Apple is a growth company, or a wonderful safe investment for widows and orphans. The ball is in Apple's court., management is not going to change, but one or two board members could be a positive. How about Elon Musk?
When you talk to a good financial advisor, the first question is comfort and ability to invest in growth stocks.
It was only 18 months ago that Apple stock was higher than Google, now it is half. What happened?
The same management is at both places.
DOES it bother anybody that the chairman of the board of Apple, Arthur Levinson is the CEO of Calico, which was recently purchased by GOOGLE?

Are you both f'n stupid? I'm not going to bother with you two anymore.

Vote No.
post #96 of 140
Quote:
Originally Posted by sog35 View Post

So you don't think Apple is cheap?  Really?

Its market cap is $500B.  Minus $150B in cash you get $250B sans cash.  Last year they made $37B in profits.  That gives you a PE ration of 6.75.  That is beyond cheap.  Total ridiculous.  Companies that are dying get higher PE Rations than 6.75.

It's the same for Exxon, Microsoft, Berkshire Hathaway, Wal-Mart. The P/E ratio doesn't tell you much at all about how traders are going to value a company. Amazon's P/E is over 1400 and traders keep pushing that stock up.

If people don't expect the big companies can grow then they aren't going to see it as a good return on investment and that's not a problem. Those people should go invest in startups with low P/E.
Quote:
Originally Posted by sog35 View Post

The reason is Wall Street is not give Apple any credit at all for their excess cash.  In fact I argue that they view it as a negative.

It doesn't matter what Wall Street's opinion is of Apple. It doesn't affect the way they do business in the slightest.
Quote:
Originally Posted by sog35 View Post

You say Apple invests its $150B for GROWTH. BS. Total BS. They have been returning 1% the last 3 years because the majority of the cash is in safe CD's. If they had it in a index fund they would have returned almost $30,000,000,000 in 2013.  Thats right.  They would have almost DOUBLED their net income for the year.

1% growth is still growth. I was referring to their investments countering some of the effects of inflation. If they only got 1% return then that's not enough to counter it but they state explicitly that they invest most of it in a way to keep it safe.
Quote:
Originally Posted by sog35 View Post

You said Apple almost double the last 6 months by doing nothing ( You are wrong, it went up 40%).

I didn't say the last 6 months, I was talking about the period between November 2011 and April 2012, it actually took 12 months to double but it shot up 75% in 6 months.
Quote:
Originally Posted by sog35 View Post

the buyback and dividend is attracting other types of investors.  An accelerated buyback in 2014 would help even more.

Why do you think they need to attract investors? Do they have a shortage of assholes telling them how to run their business? I think not.
Quote:
Originally Posted by sog35 View Post

"Their profits aren't growing and they have hit the market limits."  Really?  You conclude after ONE year of declining profits that Apple will forever stop growing?  Didn't you notice that profits shrank but units of iPhones/iPads exploded 25% in 2013?  And how do you know what the market limits are for products that have NOT EVEN BEEN RELEASED YET?  You do know Samsung sells 100,000,000 high end smartphones a year.  You don't think Apple could steal 20% of those sales and grow their iPhone profits by 20%? 

It depends on how much those smartphones sold for. Overall, Samsung sells 3x the smartphones that Apple sells along with washing machines, TVs and so on and still makes roughly the same profit as Apple.

How would you propose they go about stealing these sales anyway?
Quote:
Originally Posted by sog35 View Post

Having $150B of cash earning 1% is a major failure IMO. They could have used that money to buy Twitter, Facebook, Nuance (company behind Siri tech and Google Now). They have improved the situation with the $60B buyback but more is needed. Unless they are planning on spending $100B in the next few years in acquistions/capital than there is no reason to hold $200B earning 1%.

The opportunity cost of $200B earning 1% is massive. Even at a low 9% return they are losing $16,000,000,000 every year. Why not distrubute that excess money if Apple can't do anything with it?

Buying out companies for growth is a good idea but you criticize 1% returns and suggest they buy Twitter to improve things. Twitter is valued at $35b but in the first 6 months of 2013 made a loss of $69m on revenues of $254m. How exactly do they get the money back from that investment?

You conveniently avoid mentioning the risk involved with higher return investments. Something that gives a 'low 9%' return could also turn into a 'low 9%' loss. The way they handle investments now doesn't run with the risk of losing all of the profit they made in a year.

If they don't have ways to grow their business that fit with their way of working, a further buyback is a waste of money. If they put money in high return investments, they can lose a lot of money if they go bad as they carry more risk. At this stage, I don't think they are undervalued (almost by definition as they are valued more highly than any other company) and they are being sensible in protecting shareholder's equity.
post #97 of 140
Quote:
Originally Posted by sog35 View Post

Nuance (company behind Siri tech and Google Now). 
Tiny correction Sog: Nuance has no involvement at all with Google Now. Never has.
melior diabolus quem scies
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melior diabolus quem scies
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post #98 of 140
That is not quite the same as Jeff BEZOS WHO SPENT 8 years on Wall Street, and wrote is business plan during his drive to Seattle. Name one member of the executive team or board of Directors who has ever been accused of being an entrepreneur. The last one was named Jobs.
post #99 of 140
What about the Chairman of the Board, who is CEO of a company now owned by Google. Does that bother you?
I think s doing a super job, but needs help from the board
post #100 of 140
Quote:
Originally Posted by Gatorguy View Post

Tiny correction Sog: Nuance has no involvement at all with Google Now. Never has.

My bad. Nuance is used in samsungs S voice
post #101 of 140
Carl Icahn buys stock in companies that he thinks are undervalued. Is that a crime?
Are the stockholders worse off because of his position? I think not.
post #102 of 140
Quote:
Originally Posted by Flabingo View Post

That is not quite the same as Jeff BEZOS WHO SPENT 8 years on Wall Street, and wrote is business plan during his drive to Seattle. Name one member of the executive team or board of Directors who has ever been accused of being an entrepreneur. The last one was named Jobs.

 

Steve Jobs is a great entrepreneur, visionary, salesperson, negotiator, etc, but he's not a finance guy.  Other than reinvesting in your business (of which there's a limit), Jobs wasn't very good at capital allocation.  He asked Buffett for advise but didn't take the advise. Read this interesting article:

http://www.cnbc.com/id/46540227

 

Having said that, it all depends on how you think Apple's stock will perform.  If you think it's going to go up (ie undervalued), buy your own stock (ie buybacks) and keep it away from the stock market (ie retire them) if you think your own stock is going to go down, then continue keeping your 150 billion in the money market earning 1% per year (which is below inflation so you're actually losing purchasing power)

post #103 of 140
You said it all in a few words BRAVO
post #104 of 140
Originally Posted by Flabingo View Post
When Jobs died Apple was left without any entrepreneur, in management or on the board.

 

And you know this how?

 
It was only 18 months ago that Apple stock was higher than Google, now it is half. What happened?


Google bubble. Nothing to Apple.

 
The same management is at both places.

 

Not in the slightest.

 
DOES it bother anybody that the chairman of the board of Apple, Arthur Levinson is the CEO of Calico, which was recently purchased by GOOGLE?

 

Yep. He’ll be asked to step down (and out) within the year.

Originally posted by Marvin

Even if [the 5.5” iPhone] exists, it doesn’t deserve to.
Reply

Originally posted by Marvin

Even if [the 5.5” iPhone] exists, it doesn’t deserve to.
Reply
post #105 of 140
Oh btw, Warren Buffett says to ignore crazy Carl.
post #106 of 140
Originally Posted by jungmark View Post
Oh btw, Warren Buffett says to ignore crazy Carl.

 

Ooh, source?

 

EDIT: Ah, found it. http://bgr.com/2013/10/16/warren-buffett-apple-advice/

Originally posted by Marvin

Even if [the 5.5” iPhone] exists, it doesn’t deserve to.
Reply

Originally posted by Marvin

Even if [the 5.5” iPhone] exists, it doesn’t deserve to.
Reply
post #107 of 140
Quote:
Originally Posted by Bravadu View Post

it all depends on how you think Apple's stock will perform.  If you think it's going to go up (ie undervalued), buy your own stock (ie buybacks) and keep it away from the stock market (ie retire them) if you think your own stock is going to go down, then continue keeping your 150 billion in the money market earning 1% per year (which is below inflation so you're actually losing purchasing power)

Say that Apple took another $50b of shares out of circulation, how do they see a return that beats keeping the $50b unless they sell the shares again at a higher price? What event takes place that gives them that $50b of purchasing power back again?

The 1.03% they mention in their 10k this year is their interest rate (not far behind 1.2% inflation), however their investments seem to have dropped in value although they only become a loss if they sell them. Their income from operations was $37b and the change in value of their securities including taxes was a loss of $970m taking their total income to $36b for 2013. Their income for 2012 was $41b. If their safe investments lose them nearly $1b, it's probably in the shareholders' best interests that they don't invest in anything more risky than they already do.
post #108 of 140
Which year?
post #109 of 140

I think Buffett was referring to Icahn's very aggressive $150B buyback suggestion and not the recent more-reasonable $50B one.  

 

Icahn has already massively toned down his "suggestion" and made it a non-binding resolution on top of that.  So it's far from the ugly fights that he does with other companies.  He's been very respectful with Apple.

 

The $50B one is very manageable and thus not very risky.  It ups Apple's current $100B capital return program by 50% to $150B.

post #110 of 140
Quote:
Originally Posted by Marvin View Post


Say that Apple took another $50b of shares out of circulation, how do they see a return that beats keeping the $50b unless they sell the shares again at a higher price? What event takes place that gives them that $50b of purchasing power back again?

Apple dividend is currently giving a $3.05 dividend per quarter or $12.20 a year or a 2.18% yield.  If Apple buys back 10 million shares or $5.6B current market value, they immediately save themselves $122 million a year in dividend payments.  That is already more than what they're earning for their "investments"

 

That $5.6B in my example disappears from Apple's bank account in the form of cash.  It also disappears from Apple's market capitalization, so on paper, that might sounds bad, but there's now fewer shares outstanding and that's a good thing.  However, Apple's business fundamentals remain the same and each remaining investor now has a bigger claim to Apple's business, so this move has created value for Apple's remaining investors who didn't sell out.

 

The reverse of buybacks is that Apple can issue 100 million new shares and deposit the proceeds of the share sale into their bank account.  Repeat one thousand times for one gazillion dollars.

post #111 of 140

If they (Apple) don't retire the shares, they could resell them back onto the open market at a latter day I guess.  It will be better for the remaining investors if they retired those shares.  

 

But to retire or not to retire, heck anything is better than sitting on that pile of cash that is losing purchasing power (inflation is greater than interest earned)

post #112 of 140

If you are a strategic competitor of Apple's (or anyone really) you might start by making a list of all their possible actions. With a pile of money that big they can do virtually anything which makes it hard to plan against them.

post #113 of 140

Name me three things that Apple might do with $150B that it can't with "only" $100B.

post #114 of 140
Quote:
Originally Posted by Bravadu View Post
 

Name me three things that Apple might do with $150B that it can't with "only" $100B.

Something you can do with $150b than you can't do with $100b, is make a $50b strategic acquisition and still have $100bn of unpredictability.

post #115 of 140

Like?  Give me some names that wouldn't have significant anti-trust issues (decrease smartphone/computer competition).  Apple has proven very disciplined with their money - they make more than MS or Google, but don't spend several billion on crap like Skype and Motorola.  They really don't need to hold that much cash on hand.

 

Besides, Apple can fairly-easily raise billions from the debt market. It could raise $50B and still have a pretty low leverage ratio.  I don't think it would need to, though.

post #116 of 140
Quote:
Originally Posted by Bravadu View Post
 

Like?  Give me some names that wouldn't have significant anti-trust issues (decrease smartphone/computer competition).  Apple has proven very disciplined with their money - they make more than MS or Google, but don't spend several billion on crap like Skype and Motorola.  They really don't need to hold that much cash on hand.

 

Besides, Apple can fairly-easily raise billions from the debt market. It could raise $50B and still have a pretty low leverage ratio.  I don't think it would need to, though.

The best way to predict what companies Apple might buy, is to look at what they have bought in the past (such as Authentec, Israeli chip/ssd firms, the recent Twitter stats firm) and assume they will do more of the same. They don't seem to acquire complete products and rebrand them like Microsoft, they seem to already have some idea of what they want to build and then go out and acquire the technologies.

 

The amount of money you need to hoard to become unpredictable depends on what you estimate the computing power of your opponent to be. If you think they can predict 8 moves ahead, you need enough money to do "virtually anything" 9 or more times, and you yourself need to think 9 moves ahead. In Silicon Valley your opponents will have a lot of computing power so you will need a lot of money.

post #117 of 140
Quote:
Originally Posted by ascii View Post
 

Something you can do with $150b than you can't do with $100b, is make a $50b strategic acquisition and still have $100bn of unpredictability.

 

Problem is they will still have $150B cash at the end of 12.31.14 even if they agree to Ichan's plan.

 

Apple has $150B and is generating $50B cash flow EVERY SINGLE YEAR.  Basically Ichan is just asking Apple to used the free cash flow generated in 2014 and not touch the $150B nest egg.

post #118 of 140
Quote:
Originally Posted by ascii View Post
 

Something you can do with $150b than you can't do with $100b, is make a $50b strategic acquisition and still have $100bn of unpredictability.

 

So where does it end?  $300B?  $400B?  You could go on forever.  IMO $150B is more than enough.  And that's how much cash they would have at the end of 12.31.14 if they paid out $50B like Ichan wants (they generate $50B a year in free cash flow)

 

Apple could acquire Time Warner Cable, Twitter, Sony Corp, Nuance, Tesla, and Adobe and STILL HAVE MONEY to pay $50B buyback by 12.31.14.


Edited by sog35 - 12/29/13 at 10:12am
post #119 of 140

Yeah, what can you buy with $500B that you can't with $400B?  These hypotheticals either need to be specific or stop altogether.  Cash is a drag on Apple's metrics and performance.

 

Apple isn't buying a carrier because this will alienate and turn the other carriers into enemies.  Right now carriers are one of Apple's most-important customers.  Like China Mobile.  

 

Apple isn't buying Disney either because it will have a harder time getting new content from Disney's competitors.  Sames goes for developers like Zynga, EA or Gameloft.  Content is what makes your ecosystem good.  Buying a large content provider is bad because it turns partners into competitors, and that's just bad.

 

Apple also shouldn't get Corning, Broadcom, Sharp or Qualcomm (suppliers).  Antitrust concerns aside, those companies need to license a lot of intellectual property from other companies to produce parts.  If Apple bought them, they would have to pay massively more for IPs. Those companies are better off staying independent.

 

Apple could buy Foxconn I guess, but that's opening up a can of worms and a potential PR nightmare.

 

I think holding $50B in cash is more than enough.  Buy Sony and Broadcom for $35B combined?  You can, but I would recommend against it.   Apple should either buy companies that make its products better or make future products possible.  Fortunately those companies are cheap and usually costing no more than a week of Apple's profits as Apple adds about $50B a year to their bank account.  Apple can also comfortably raise another $50B from the debt markets if needed.  Apple doesn't have a cash shortage problem.

post #120 of 140

A terrible plan that leaves open the possibility that if Apple's sales and profits fall like Zubaz, its shareholders could end up with zero.  

 

I am an Apple fan and it has gone downhill before.

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