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Apple repurchases $14B of own stock over two weeks after 8% decline

post #1 of 72
Thread Starter 
Apple CEO Tim Cook revealed on Thursday that the company has bought back some $14 billion worth of AAPL shares since an earnings call two weeks ago, saying the move is the biggest repurchase on record for such a short period.

Apple


Speaking with The Wall Street Journal, Cook said he was "surprised" to see the 8 percent drop in share price immediately following the release of Apple's quarterly results and wanted to pounce on the opportunity.

In a move he called "aggressive" and "opportunistic," Cook authorized the $14 billion repurchase, which brings the grand total to $40 billion worth of shares in the past year. To put that in perspective, Apple spent $16 billion on buybacks over a full quarter in 2013.

"It means that we are betting on Apple. It means that we are really confident on what we are doing and what we plan to do," Cook said. "We're not just saying that. We're showing that with our actions."

Apple announced in April 2013 a $100 billion capital return program that includes $60 billion in share repurchases and an increased quarterly dividend of 15 percent. The plan is scheduled to run through 2015.

Cook also offered insight into Apple's financial plans, saying the company purchased 21 companies over the past 15 months, with none of the deals exceeding $1 billion.

"You want to be able to adjust for the long-term interest of the shareholders, not for the short-term shareholder, not for the day trader," Cook explained. "We may see a huge company tomorrow that we want to acquire or something may happen in the stock market that's unpredictable."

Google, on the other hand, continues its buying spree with high-profile deals including robotics contractor Boston Dynamics and smart home device firm Nest. In the case of Nest, Google spent $3.2 billion to bring the company cofounded by former Apple employees Tony Fadell and Matt Rogers into the fold.

While Apple has yet to spend nearly that amount on a single buy, Cook said such an acquisition is not out of the realm of possibility.

"We've looked at big companies. We don't have a predisposition not to buy big companies," Cook said. "The money is also not burning a hole in our pocket where we say, 'let's make a list of 10 and pick the best one.' We have no problem spending ten figures for the right company, for the right fit that's in the best interest of Apple in the long-term. None. Zero."
post #2 of 72
Good

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post #3 of 72
OK - Here we go.

This was a great move by Tim Cook - fantastic action, and positive statement to WS Journal.

I am a HUGE Tim Cook supporter -only adjustment that I hope for in his actions was this - more positive verbal communications to the Press - and decisive action. This purchase was.

I am sure that Carl is thrilled with this statement. What we need is aggressive follow-up - authorized another $50 Billion - and keep buying buying buying on all weakness under $600. Borrow at low rates and lets get this stock up to $600 and don't let it fall below that number.

Mindset will then change with new product announcements and we will move where it should be which is in the $700-800 range.

Ultimate good move would be to announce additional program at the meeting, and a great stock split saying that Apple is extremely confident with its growth and new product launches in the forthcoming calendar year. -- great for Apple recruitment of top engineers, and long term shareholders
post #4 of 72
Originally Posted by slluffs View Post
LOL

 

I predict big things from you.

Originally posted by Relic

...those little naked weirdos are going to get me investigated.
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Originally posted by Relic

...those little naked weirdos are going to get me investigated.
Reply
post #5 of 72
OMG - they just bought back over 27 million shares. Highly aggressive move

Great to see Apple on the offensive

Windows survivor - after a long, epic and painful struggle. Very long AAPL

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Windows survivor - after a long, epic and painful struggle. Very long AAPL

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post #6 of 72
Wow. Who knew Cook et al knew what they are doing? Oh yeah, intelligent people. See Carl, Apple doesn't need your help.
post #7 of 72
Incredibly stupid graphic to go with this story. Surely you can be more newsworthy or less generic. Insulting to readers.
post #8 of 72
Quote:
Apple CEO Tim Cook revealed on Thursday that the company has bought back some $14 billion worth of AAPL shares since an earnings call two weeks ago.
And none of it was purchased from Carl...
post #9 of 72

When you compare Apple's stock price to other tech/internet stocks it is hilarious how cheap it is. They generate a ton of cash flow/profits each quarter and are not even recognizing all their profits(they are deferring a portion of them).

 

Truth is, they can buy back ALL their stock in a few years themselves if Wall Street doesn't want it...and Wall Street doesn't deserve it.

post #10 of 72

You are right, Ub, Wall Street doesn't value these shares, now let them pay more for them - they don't deserve them

post #11 of 72

Red flag ditz comment.

 

You don't think that Carl suggesting buy backs has influenced Tim (who I support and Carl) starting to act pre shareholder meeting?

 

Are you really that naive???????????????   You are joking aren't you??????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????

post #12 of 72
Quote:
Originally Posted by Chris_CA View Post


And none of it was purchased from Carl...

 

Great comment  - for the people that think Carl is requesting a personal check … these are buy-backs, people here would have thought this was a check to Carl if you did not note!

post #13 of 72
Fuc!,? yeah... thats how you do it...
post #14 of 72

So Apple can time their stock repurchases? I thought they were either carried out on a known schedule or they were carried out by a disinterested third party without Apple's direction.

 

Doesn't leaving the ability to repurchase shares when the stock is low (for whatever reason) create a conflict of interest? It would behoove the CEO or another highly placed person to undermine the stock in order to create an ideal buyback situation. Not saying that is what has happened (after all, if they were more focused on the opportunity, they should've bought back billions of their own stock when it sunk to the mid-$80 range at the beginning of the Depression/Recession...they could have essentially taken the company private at that point).

Proud AAPL stock owner.

 

GOA

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Proud AAPL stock owner.

 

GOA

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post #15 of 72
Quote:
Originally Posted by nyuestateplanninglawyer View Post

OK - Here we go.

This was a great move by Tim Cook - fantastic action, and positive statement to WS Journal.

I am a HUGE Tim Cook supporter -only adjustment that I hope for in his actions was this - more positive verbal communications to the Press - and decisive action. This purchase was.

I am sure that Carl is thrilled with this statement. What we need is aggressive follow-up - authorized another $50 Billion - and keep buying buying buying on all weakness under $600. Borrow at low rates and lets get this stock up to $600 and don't let it fall below that number.

Mindset will then change with new product announcements and we will move where it should be which is in the $700-800 range.

Ultimate good move would be to announce additional program at the meeting, and a great stock split saying that Apple is extremely confident with its growth and new product launches in the forthcoming calendar year. -- great for Apple recruitment of top engineers, and long term shareholders

You obviously missed Tim's message. Namely, he does not support Carl or other short term traders like him. He clearly is saying Apple took advantage of the drop under its current program. Ironically despite what some of the short term investors say, Apple's buy did very little for the stock price.

Cook is also clearly saying Apple needs to hold on to cash for opportunities like buying companies, settling lawsuits, ect.

I doubt Apple will do a split either. Higher priced stocks keep a lot of folks out and helps stability.
post #16 of 72
Quote:
Originally Posted by SpamSandwich View Post
they could have essentially taken the company private at that point).

Via money from Jobs and other insiders?  It's not like a publicly traded company can buy itself.

post #17 of 72
Quote:
Originally Posted by nyuestateplanninglawyer View Post

Red flag ditz comment.

You don't think that Carl suggesting buy backs has influenced Tim (who I support and Carl) starting to act pre shareholder meeting?

Are you really that naive???????????????   You are joking aren't you??????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????

I think the message was we already have a buy back program and that Carl can go suck it. That is what Netflix told Carl, and its stock has being doing quite well since Carl sold. Carl fans should go research how he made his fortune as a corporate raider. He destroyed TWA making himself rich and leaving stockholders with nothing.
post #18 of 72
Quote:
Originally Posted by Ub52209 View Post

When you compare Apple's stock price to other tech/internet stocks it is hilarious how cheap it is. They generate a ton of cash flow/profits each quarter and are not even recognizing all their profits(they are deferring a portion of them).

Truth is, they can buy back ALL their stock in a few years themselves if Wall Street doesn't want it...and Wall Street doesn't deserve it.
Quote:
Originally Posted by Ub52209 View Post

When you compare Apple's stock price to other tech/internet stocks it is hilarious how cheap it is. They generate a ton of cash flow/profits each quarter and are not even recognizing all their profits(they are deferring a portion of them).

Truth is, they can buy back ALL their stock in a few years themselves if Wall Street doesn't want it...and Wall Street doesn't deserve it.

Very true. Within 6-8 years, they could buy back a large%. They need to get rid of their dividend, let the stock sink into the low $400,s, issue bonds to buy back $200 billion in shares at $400. Their dividend has been a complete failure on creating enthusiasm for their shares. If Apple believes they are undervalued, use Cash to buy your shares, not to issue a paltry dividend.
post #19 of 72
Quote:
Originally Posted by SpamSandwich View Post
 

So Apple can time their stock repurchases? I thought they were either carried out on a known schedule or they were carried out by a disinterested third party without Apple's direction.

 

Doesn't leaving the ability to repurchase shares when the stock is low (for whatever reason) create a conflict of interest? It would behoove the CEO or another highly placed person to undermine the stock in order to create an ideal buyback situation. Not saying that is what has happened (after all, if they were more focused on the opportunity, they should've bought back billions of their own stock when it sunk to the mid-$80 range at the beginning of the Depression/Recession...they could have essentially taken the company private at that point).

It's a good question.

My first thought was: "Wow, now the MMs will have real cause to tank the stock; because then TC will (clearly) buy more if they do. (?)

post #20 of 72
Quote:
Originally Posted by SpamSandwich View Post
 

So Apple can time their stock repurchases? I thought they were either carried out on a known schedule or they were carried out by a disinterested third party without Apple's direction.

 

Doesn't leaving the ability to repurchase shares when the stock is low (for whatever reason) create a conflict of interest? It would behoove the CEO or another highly placed person to undermine the stock in order to create an ideal buyback situation. Not saying that is what has happened (after all, if they were more focused on the opportunity, they should've bought back billions of their own stock when it sunk to the mid-$80 range at the beginning of the Depression/Recession...they could have essentially taken the company private at that point).

 

I would think that if Apple provided false information that tanked the stock and then bought, I think that would be illegal. If the market reacts negatively of its own free will and Apple takes advantage of it, then I don't see where the conflict would be. I could be completely wrong though.

post #21 of 72

That SO rocks!

post #22 of 72
Smart move.
post #23 of 72

This stock purchase is exactly the advice Warren Buffet offers.  He said shares of Berkshire contracted 50% at least twice and he was an aggressive buyer of shares outstanding during those times.

 

And whether you agree with Carl or not, I think his aggressive statements about Apple's under-valuation, plus his confidence in his position by adding an additional $.5 BN purchase after the sudden $50 drop in share price draws a lot of needed Wall Street ATTENTION and DISCUSSION back to the Apple story and its vast potentiality.   (And a lot of investors were starting to take Carl's proposals more seriously when WS punished Apple's shares due to its not attaining WS's voodoo iPhone sales'  expectations over and above what the Company forecasted (even though the Company did achieve the 4th highest revenue quarter in US history being surpassed only by big oil and Apple itself.  That stock drop P.O'ed a lot of stakeholders including Tim C).

 

I too am a big Tim Cook supporter, especially since he was handpicked long ago by Steve J himself.  How many people could live up to trying to follow the sentimentality and warranted tech/business fame of a "god" like Steve J, who was so famous and revered upon his untimely death, that millions of fans cried and laid wreathes in front of Apple store windows around the world?   Pundits know they can still make a good living just from writing disparaging, speculative articles knocking down Apple and T.C.'s leadership by spreading fear, rumors, and unfounded doubt.   (To be a famous pundit, just start with a SHOCK headline, and fill in a bogus story underneath it.  If it is 100% wrong, the writer still gets her hits and pockets her bounty, as she fades into obscurity and invents a new nom de plum.)

post #24 of 72
Quote:
Originally Posted by SpamSandwich View Post

So Apple can time their stock repurchases? I thought they were either carried out on a known schedule or they were carried out by a disinterested third party without Apple's direction.

Doesn't leaving the ability to repurchase shares when the stock is low (for whatever reason) create a conflict of interest? It would behoove the CEO or another highly placed person to undermine the stock in order to create an ideal buyback situation. Not saying that is what has happened (after all, if they were more focused on the opportunity, they should've bought back billions of their own stock when it sunk to the mid-$80 range at the beginning of the Depression/Recession...they could have essentially taken the company private at that point).

I am afraid this post makes no sense. A company can buy when it wants once the repurchase program is in place.
post #25 of 72
Excellent move. My only regret is that he did not exhaust the entire quota of $60B.
post #26 of 72

Keep buying back low until you can take it private. Then give Wall Street the middle finger.

post #27 of 72
Quote:
Originally Posted by anantksundaram View Post

Excellent move. My only regret is that he did not exhaust the entire quota of $60B.

 

He still might get a chance at an even better deal.

na na na na na...
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na na na na na...
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post #28 of 72
So the WSJ will be running more of their interview with Cook on Friday. In it Cook apparently says any reasonable person would classify what Apple is working on as new categories.
post #29 of 72
Quote:
Originally Posted by island hermit View Post

Quote:
Originally Posted by anantksundaram View Post

Excellent move. My only regret is that he did not exhaust the entire quota of $60B.

He still might get a chance at an even better deal.

He doesn't know that, just as you and I don't. That said, let's hope that does not come to pass.

The tenor of the interview sounds to me like he was quite surprised and p-o'ed at the negative market reaction to what he thought was a blowout quarter from Apple. I sincerely hope that this is the beginning of his getting to be a bit more savvy and proactive with Wall Street.
post #30 of 72
Quote:
Originally Posted by lkrupp View Post

Keep buying back low until you can take it private. Then give Wall Street the middle finger.

Taking Apple private is not an option.
post #31 of 72
Quote:
Originally Posted by anantksundaram View Post

Excellent move. My only regret is that he did not exhaust the entire quota of $60B.

might not be as simple as that. The buyback is scheduled to run until end 2015 and given the majority of cash is held offshore they probably worked how much cash will be coming in over the 3 years which allows them a sort of schedule to buyback without going into extra debt.
post #32 of 72
Quote:
Originally Posted by SpamSandwich View Post
 

So Apple can time their stock repurchases? I thought they were either carried out on a known schedule or they were carried out by a disinterested third party without Apple's direction.

 

Doesn't leaving the ability to repurchase shares when the stock is low (for whatever reason) create a conflict of interest? It would behoove the CEO or another highly placed person to undermine the stock in order to create an ideal buyback situation. Not saying that is what has happened (after all, if they were more focused on the opportunity, they should've bought back billions of their own stock when it sunk to the mid-$80 range at the beginning of the Depression/Recession...they could have essentially taken the company private at that point).

 

Whatever gave you the idea that they have to follow a schedule? They don't have to declare any such intentions at all, at any time. The only reason that Apple made known its intentions to buy back stock over time was to calm down an increasingly noisy mob that claimed that all that cash was not generating a sufficient return. Technically, they could drop $100 billion tomorrow if they wanted, presuming that sources of finance could provide them with that much cash to buy shares as a loan against the collateral of Apple's cash and equivalents held outside the U.S. Practically, it wouldn't make sense since there's not $100 billion of AAPL stock floating in the marketplace. The price would be driven up in the short run by $100 billion of instant additional demand, which would be counter to repurchasing shares at a good bargain.

 

"A disinterested third party without Apple's direction." Now think that one over. It's ludicrous on the face of it.

 

Exactly as Tim Cook said, Apple is being "opportunistic" in taking advantage of a real bargain price in recent days. Signalling your intentions is like walking down a dark back street with cash sticking out of your pockets, just begging to be mugged.

 

As to a CEO or others "undermining the stock" - that's called manipulation. It's illegal as hell and it's highly discoverable. Want to see your Apple leadership spend time in the Graybar Hotel? Let 'em queer the stock price.

 

Finally, whoever referred to Carl Icahn as a "short investor" doesn't know what he is talking about. There is no such term. There are "short sellers" and "short-term investors" (such as day traders). Icahn is neither. Icahn has skin in the game by actually putting money into a stock position, which he expects to recoup and then some when he sells his shares for a handsome gain at some reasonable point in the future. In that respect his interests are exactly aligned with most other Apple shareholders. Moreover, Icahn has supported a major Apple stock buyback as the optimal present strategy to stimulate the market price. Reducing the supply of shares outstanding increases the equilibrium point between supply and demand, other factors being equal.


Edited by Kibitzer - 2/6/14 at 7:54pm

I admit to being a Fanatical Moderate. I Disdain the Inane. Vyizderzominymororzizazizdenderizorziz?

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I admit to being a Fanatical Moderate. I Disdain the Inane. Vyizderzominymororzizazizdenderizorziz?

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post #33 of 72
post #34 of 72
Quote:
Originally Posted by anantksundaram View Post

He doesn't know that, just as you and I don't. That said, let's hope that does not come to pass.

The tenor of the interview sounds to me like he was quite surprised and p-o'ed at the negative market reaction to what he thought was a blowout quarter from Apple. I sincerely hope that this is the beginning of his getting to be a bit more savvy and proactive with Wall Street.
Yes, yes, yes. Personally I'd like to see Cook more pissed off and show it in comments with Wall Street analysts or the tech media. Go on offense rather than always playing defense.
post #35 of 72
So that's about $80 million in dividends they won't be paying this quarter.
post #36 of 72
Quote:
Originally Posted by SpamSandwich View Post

So Apple can time their stock repurchases? I thought they were either carried out on a known schedule or they were carried out by a disinterested third party without Apple's direction.
I think there is a freeze period before the results are posted, but once information is public there should be no reason the CEO can't push for more aggressive buyback within the board-approved allowance. I'm not sure if they are allowed to make any transactions during the freeze, or if they can have algorithm purchases that are set prior to freeze.
post #37 of 72
I hope Apple buys back as many shares as possible to stop the power of the institutional investors whose only interest is in short profits, not the interest of Apple and its customers.
post #38 of 72
Quote:
Originally Posted by anantksundaram View Post

I am afraid this post makes no sense. A company can buy when it wants once the repurchase program is in place.

I wonder. Considering the raft of penalties and charges levied against Apple by our government handlers in recent years, someone from the SEC may decide that the earnings call, followed by a large stock drop, followed by a massive buyback equals an opportunity to throw the book at Apple.

Proud AAPL stock owner.

 

GOA

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Proud AAPL stock owner.

 

GOA

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post #39 of 72
Quote:
Originally Posted by Kibitzer View Post

What
ever gave you the idea that they have to follow a schedule? They don't have to declare any such intentions at all, at any time. The only reason that Apple made known its intentions to buy back stock over time was to calm down an increasingly noisy mob that claimed that all that cash was not generating a sufficient return. Technically, they could drop $100 billion tomorrow if they wanted, presuming that sources of finance could provide them with that much cash to buy shares as a loan against the collateral of 
Apple's cash and equivalents held outside the U.S. Practically, it wouldn'
t make sense since there's not $100 billion of AAPL stock floating in the marketplace. T
he price would be driven up in the short run by $100 billion of instant additional demand, which would be counter to repurchasing shares at a good bargain.


"A
 disinterested third party without Apple's direction." Now think that one over. It's ludicrous on the face of it.

Exactly as Tim Cook said, Apple is being "opportunistic" in taking advantage of a real bargain price in recent days. Signalling your intentions is like walking down a dark back street with cash sticking out of your pockets, just begging to be mugged.

As to a CEO or others "undermining the stock" - that's called manipulation. It's illegal as hell and it's highly discoverable. Want to see your Apple leadership spend time in the Graybar Hotel? Let 'em queer the stock price.

Finally, whoever referred to Carl Icahn as a "short investor" doesn't know what he is talking about. There is no such term. There are "short sellers" and "short-term investors" (such as day traders). Icahn is neither. Icahn has skin in the game by actually putting money into a stock position, which he expects to recoup and then some when he sells his shares for a handsome gain at some reasonable point in the future. In that respect his interests are exactly aligned with most other Apple shareholders. Moreover, Icahn has supported a major Apple stock buyback as the optimal present strategy to stimulate the market price. Reducing the supply of shares outstanding increases the equilibrium point between supply and demand, other factors being equal.

Here are the rules, per the SEC regarding share repurchases: https://blogs.law.harvard.edu/corpgov/2013/03/14/questions-surrounding-share-repurchases/

There is still enough wiggle room in the law to allow for charges to brought against companies the government is determined to bully or blackmail, in my opinion.

Proud AAPL stock owner.

 

GOA

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Proud AAPL stock owner.

 

GOA

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post #40 of 72
Quote:
Originally Posted by quinney View Post

So that's about $80 million in dividends they won't be paying this quarter.

Fine by me. I'd rather have amazing growth and insane profitability than dividends. I was against the instituting of dividends at Apple and still see it as capitulation to Wall Street demands.

Proud AAPL stock owner.

 

GOA

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Proud AAPL stock owner.

 

GOA

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