Apple has almost $150 Billion and are doing NOTHING with it. The cost of doing nothing with the money is a 8-10% loss every year. There is no reason Apple needs to hoard so much cash. They need to return some of it to investors, make an acquisition, or at least tell investors what they plan to do in the future.
But they *are* doing something with it. You're just arguing from a position of ignorance because you see the word cash and just seem to assume it's in a savings account somewhere. That "cash" is largely in the form of a variety of investments, short and long term.
Einhorn probably knows this but is lying about it.
Last I heard, dividends are taxed differently from capital gains, and paying out dividends deflates the stock's value by said amount, so the value of paying them seems negative.
This business about preferred vs. common stock seems to me he has some scheme in mind, hopefully shareholders carefully weigh his proposals with that in mind.
Suing the company you own a part of is pretty stupid too, either way, you lose. You're paying your legal team, or indirectly, your shares are paying their legal team. Or both.
Apple has almost $150 Billion and are doing NOTHING with it. The cost of doing nothing with the money is a 8-10% loss every year. There is no reason Apple needs to hoard so much cash. They need to return some of it to investors, make an acquisition, or at least tell investors what they plan to do in the future.
But they *are* doing something with it. You're just arguing from a position of ignorance because you see cash and just seem to assume it's in a savings account somewhere. That "cash" is largely in the form of a variety of investments, short and long term.
Einhorn probably knows this but is lying about it.
Shareholder voting rights to guide a company is a nice idea that's taken to unreasonable extents. Public ownership quickly abandons the idea of any given business and focuses entirely on profits and stock value.
I'll say from the top what this hedge fund shark says is asinine in all senses, but what dysamoria said is equally as crazy. I think people forget what being a public company means, and what being a shareholder is. Shareholders OWN the company. Period. Apple is not Tim's company, or even Job's company, they don't have carte blanche to do whatever they want. You fork over money to own stock as an investment stake in a company for a financial return. There is nothing UNREASONABLE about that. Executives are charged with protecting the interest of shareholders. You can be as vocal about your interests as you want. Most are silent, but what this guy says isn't outrageous, he's (crazily) stating is interests. Don't like the rules? Don't take people's money and go private.
Making the best products and devices doesn't mean anything if the stock is taking a severe beating. It is Apple's problem to fix and they haven't been proactive enough on that front.
Apple needs to convince me why I should put some of my money into AAPL and keep it there. I don't like the way that the stock has been performing for a while now. Apple has a duty to it's shareholders.
Let's see, Apple had one of the most profitable qtrs ever, had the most profitable calendar year ever, sells records iphones, ipads every quarter (yoy).
if Apple commented on every rumor, nothing will ever get done. In addition, if they don't comment on a rumor, does it make it true?
The stock took a beating because analysts like to make up numbers.
If shareholders want to force management to change AAPLs cash-management approach, they have two direct ways of doing so: through a vote to that effect or by replacing the BOD. Going to court is a stupid, counter-productive way to go about it. I hope the suit get tossed out quickly.
I'm a long-term AAPL shareholder (since the return of SJ) and I'm sure that a larger proportion of my net assets are tied up in AAPL than Einhorn's. I'm not happy about the recent share price drop, but I don't want management wasting time and effort on financial games to shore up the price. Keep focused on the next generation of insanely great products and we'll be fine. Or not, but that's still the right strategy. Worrying about stock price based on the latest rumor and analyst prediction is a fool's game.
#next_pages_container { width: 5px; hight: 5px; position: absolute; top: -100px; left: -100px; z-index: 2147483647 !important; } 'Hedge Fund Managers' are part of the financial system that destroyed our economy.
If we can drone strike American born terrorists, why are these guys out of bounds?
It's unlikely that a hedge fund manager qualifies as a, "stable long time investor." It's exactly this sort of "shareholder action" that's screwed up many a company in this country, so hopefully they will stamp this out without him being able to do any damage.
Public ownership sucks. Fiduciary responsibility is just a catch phrase for wresting control of a company from those that comprehend it. IMO, most public companies should go private again (like Dell, curiously). The capitalist insanity disease in the USA needs a major remedy. Wall Street greed is self destructive to society. It's too complicated a system, and the complexity is in the interest of "lawyering what you want by force", over the people that actually comprehend the running of any particular business. Shareholder voting rights to guide a company is a nice idea that's taken to unreasonable extents. Public ownership quickly abandons the idea of any given business and focuses entirely on profits and stock value. There's a fundamental conflict of interest.
Terrific contribution to this discussion. I encourage everyone to read this short essay before posting on this topic. It's very informative and somewhat surprising.
"There is no reason Apple needs to hoard so much cash."
Unless they want to use it for development to scoop the market with another big advance that no one sees coming. Nah, they'd never pull a stunt like that...
"Apple has $145 per share of cash on its balance sheet. As a shareholder, this is your money."
That assumes the only reason Apple has money is because the shareholders gave them some. It utterly ignores the idea that a company sees gains and is supposed to manage its assets for consistent return and opportunity.
"Maybe Apple really needs a little prodding to take care of its stable long time investors..."
I *didn't* buy 100 shares of Apple at $24 in 1984. Bought a $2,400 used Subaru. At the time, borrowing for the car would have cost me 10%, and Apple was returning a few percent per year. So no brainer, right? Unless I was thinking like a long-term investor. Which with the three splits, I'd now have 800 shares of AAPL at an effective purchase price of $3 and could have sold it maxed at $700 per share and be writing this from my island lair. I think Apple has taken great care of anyone who's been in it for the long haul.
I always laugh when people say Apple is doing nothing with their money.
Nobody knows what Apple has planned for the future. It's often rumored Apple wants to enter TV. Well, it could cost them huge $$$ to compete with the cable companies or to secure deals from all the networks. What if "the next thing" isn't TV at all but something completely different we haven't thought about?
I personally think Apple has something in the works. I don't see them looking to have the largest piggy bank in the tech world - at some point they're going to do something with their reserves.
Let's see, Apple had one of the most profitable qtrs ever, had the most profitable calendar year ever, sells records iphones, ipads every quarter (yoy).
if Apple commented on every rumor, nothing will ever get done. In addition, if they don't comment on a rumor, does it make it true?
The stock took a beating because analysts like to make up numbers.
I agree, Apple has been doing pretty damn good and is treated unfairly by the street, but the main thing that matters is how the stock graph looks IMO, and it hasn't been looking good for a while now. Having faith in Apple and the products that they make is one thing, but I see having faith in AAPL as being something completely different.
Especially with the impressive results that Apple has had and continues to deliver, they should be able to combat some of the FUD and take the necessary steps to bring the stock back on course. I've written before that hoarding money is obviously not impressing anybody and it doesn't benefit AAPL, so I don't mind if they start spending more of that money.
Which means he bought high and is pissed about his own poor judgement. Poor baby.
Haha. For one, the US gov't thinks a year is considered a long-term capital investment. Two, for a hedge fund, a year is a particularly long time. Three, he bought the stock over year ago, which despite recent media frenzy, is still flat to up YoY. So... its not like he's sitting on a major loss (just lost profits).
He thinks the stock is materially undervalued and that management has grossly mismanaged its balance sheet. Frankly, he's right. There's no conceivable use for $137bn in cash. It should be returned to shareholders. The stock trades at a 7 PE ex cash, which implies ~15% cost of capital. Apple is earning 0-1% on its cash balances. How is that efficient capital use?
Finally, Apple is self-funded from cash flows and is significantly cash flow positive meaning it can fully fund its massive growth without raising debt or drawing down on its bank account.
You shouldn't attack someone for suggesting a public company has a fiduciary duty to his shareholders.
You can be as vocal about your interests as you want. Most are silent, but what this guy says isn't outrageous, he's (crazily) stating is interests. Don't like the rules? Don't take people's money and go private.
There's more to it than that. Suing the company because they don't bend to his will is a lot more than just "stating his interests". He didn't even take it to the shareholders before suing anyway, and now he's saying that he's doing it for the shareholder's interests? If anyone believes that, I have an island for sale.
is it me or does that picture of this guy make you think 'gormless idiot' something about his slightly askew smile maybe.... anyways, I agree Apple could do more to spend it's hoard, but I'd rather they spent it on making the Mac line even more awesome and also dedicating a ton of $$ on making the software line the very best there is. Couldn't do any harm and could do a lot for the PR of Apple. I mean who really wanted a 'thinner' iMac?
Comments
But they *are* doing something with it. You're just arguing from a position of ignorance because you see the word cash and just seem to assume it's in a savings account somewhere. That "cash" is largely in the form of a variety of investments, short and long term.
Einhorn probably knows this but is lying about it.
Last I heard, dividends are taxed differently from capital gains, and paying out dividends deflates the stock's value by said amount, so the value of paying them seems negative.
This business about preferred vs. common stock seems to me he has some scheme in mind, hopefully shareholders carefully weigh his proposals with that in mind.
Suing the company you own a part of is pretty stupid too, either way, you lose. You're paying your legal team, or indirectly, your shares are paying their legal team. Or both.
But they *are* doing something with it. You're just arguing from a position of ignorance because you see cash and just seem to assume it's in a savings account somewhere. That "cash" is largely in the form of a variety of investments, short and long term.
Einhorn probably knows this but is lying about it.
Quote:
Originally Posted by dysamoria
Shareholder voting rights to guide a company is a nice idea that's taken to unreasonable extents. Public ownership quickly abandons the idea of any given business and focuses entirely on profits and stock value.
I'll say from the top what this hedge fund shark says is asinine in all senses, but what dysamoria said is equally as crazy. I think people forget what being a public company means, and what being a shareholder is. Shareholders OWN the company. Period. Apple is not Tim's company, or even Job's company, they don't have carte blanche to do whatever they want. You fork over money to own stock as an investment stake in a company for a financial return. There is nothing UNREASONABLE about that. Executives are charged with protecting the interest of shareholders. You can be as vocal about your interests as you want. Most are silent, but what this guy says isn't outrageous, he's (crazily) stating is interests. Don't like the rules? Don't take people's money and go private.
Laces Out!!!
Quote:
Originally Posted by Apple ][
I'm siding with the hedge fund.
Making the best products and devices doesn't mean anything if the stock is taking a severe beating. It is Apple's problem to fix and they haven't been proactive enough on that front.
Apple needs to convince me why I should put some of my money into AAPL and keep it there. I don't like the way that the stock has been performing for a while now. Apple has a duty to it's shareholders.
Let's see, Apple had one of the most profitable qtrs ever, had the most profitable calendar year ever, sells records iphones, ipads every quarter (yoy).
if Apple commented on every rumor, nothing will ever get done. In addition, if they don't comment on a rumor, does it make it true?
The stock took a beating because analysts like to make up numbers.
Quote:
Originally Posted by Frac
Crap yourself!
Read this...
http://www.directorship.com/stout-shareholders-as-owners/
That was fascinating. I thought shareholders owned the company and the directors were, indeed, agents of the shareholders. I stand corrected.
If shareholders want to force management to change AAPLs cash-management approach, they have two direct ways of doing so: through a vote to that effect or by replacing the BOD. Going to court is a stupid, counter-productive way to go about it. I hope the suit get tossed out quickly.
I'm a long-term AAPL shareholder (since the return of SJ) and I'm sure that a larger proportion of my net assets are tied up in AAPL than Einhorn's. I'm not happy about the recent share price drop, but I don't want management wasting time and effort on financial games to shore up the price. Keep focused on the next generation of insanely great products and we'll be fine. Or not, but that's still the right strategy. Worrying about stock price based on the latest rumor and analyst prediction is a fool's game.
#next_pages_container { width: 5px; hight: 5px; position: absolute; top: -100px; left: -100px; z-index: 2147483647 !important; }
'Hedge Fund Managers' are part of the financial system that destroyed our economy.
If we can drone strike American born terrorists, why are these guys out of bounds?
Quote:
Originally Posted by dysamoria
Quote:
Originally Posted by anonymouse
It's unlikely that a hedge fund manager qualifies as a, "stable long time investor." It's exactly this sort of "shareholder action" that's screwed up many a company in this country, so hopefully they will stamp this out without him being able to do any damage.
Public ownership sucks. Fiduciary responsibility is just a catch phrase for wresting control of a company from those that comprehend it. IMO, most public companies should go private again (like Dell, curiously). The capitalist insanity disease in the USA needs a major remedy. Wall Street greed is self destructive to society. It's too complicated a system, and the complexity is in the interest of "lawyering what you want by force", over the people that actually comprehend the running of any particular business. Shareholder voting rights to guide a company is a nice idea that's taken to unreasonable extents. Public ownership quickly abandons the idea of any given business and focuses entirely on profits and stock value. There's a fundamental conflict of interest.
Mmm... What do you, personally, invest in?
Quote:
Originally Posted by Frac
Read this...
http://www.directorship.com/stout-shareholders-as-owners/
Terrific contribution to this discussion. I encourage everyone to read this short essay before posting on this topic. It's very informative and somewhat surprising.
Unless they want to use it for development to scoop the market with another big advance that no one sees coming. Nah, they'd never pull a stunt like that...
"Apple has $145 per share of cash on its balance sheet. As a shareholder, this is your money."
That assumes the only reason Apple has money is because the shareholders gave them some. It utterly ignores the idea that a company sees gains and is supposed to manage its assets for consistent return and opportunity.
"Maybe Apple really needs a little prodding to take care of its stable long time investors..."
I *didn't* buy 100 shares of Apple at $24 in 1984. Bought a $2,400 used Subaru. At the time, borrowing for the car would have cost me 10%, and Apple was returning a few percent per year. So no brainer, right? Unless I was thinking like a long-term investor. Which with the three splits, I'd now have 800 shares of AAPL at an effective purchase price of $3 and could have sold it maxed at $700 per share and be writing this from my island lair. I think Apple has taken great care of anyone who's been in it for the long haul.
Quote:
Originally Posted by Apple ][
Making the best products and devices doesn't mean anything if the stock is taking a severe beating.
I can't believe somebody actually typed this.
This guy is a greedy SOB who cares only about ripping off all the money in the world for himself.
Tell him what to go do with himself.
I always laugh when people say Apple is doing nothing with their money.
Nobody knows what Apple has planned for the future. It's often rumored Apple wants to enter TV. Well, it could cost them huge $$$ to compete with the cable companies or to secure deals from all the networks. What if "the next thing" isn't TV at all but something completely different we haven't thought about?
I personally think Apple has something in the works. I don't see them looking to have the largest piggy bank in the tech world - at some point they're going to do something with their reserves.
Quote:
Originally Posted by jungmark
Let's see, Apple had one of the most profitable qtrs ever, had the most profitable calendar year ever, sells records iphones, ipads every quarter (yoy).
if Apple commented on every rumor, nothing will ever get done. In addition, if they don't comment on a rumor, does it make it true?
The stock took a beating because analysts like to make up numbers.
I agree, Apple has been doing pretty damn good and is treated unfairly by the street, but the main thing that matters is how the stock graph looks IMO, and it hasn't been looking good for a while now. Having faith in Apple and the products that they make is one thing, but I see having faith in AAPL as being something completely different.
Especially with the impressive results that Apple has had and continues to deliver, they should be able to combat some of the FUD and take the necessary steps to bring the stock back on course. I've written before that hoarding money is obviously not impressing anybody and it doesn't benefit AAPL, so I don't mind if they start spending more of that money.
Quote:
Originally Posted by GQB
Oh wow! A whole YEAR?!!
Which means he bought high and is pissed about his own poor judgement. Poor baby.
Haha. For one, the US gov't thinks a year is considered a long-term capital investment. Two, for a hedge fund, a year is a particularly long time. Three, he bought the stock over year ago, which despite recent media frenzy, is still flat to up YoY. So... its not like he's sitting on a major loss (just lost profits).
He thinks the stock is materially undervalued and that management has grossly mismanaged its balance sheet. Frankly, he's right. There's no conceivable use for $137bn in cash. It should be returned to shareholders. The stock trades at a 7 PE ex cash, which implies ~15% cost of capital. Apple is earning 0-1% on its cash balances. How is that efficient capital use?
Finally, Apple is self-funded from cash flows and is significantly cash flow positive meaning it can fully fund its massive growth without raising debt or drawing down on its bank account.
You shouldn't attack someone for suggesting a public company has a fiduciary duty to his shareholders.
There's more to it than that. Suing the company because they don't bend to his will is a lot more than just "stating his interests". He didn't even take it to the shareholders before suing anyway, and now he's saying that he's doing it for the shareholder's interests? If anyone believes that, I have an island for sale.
anyways, I agree Apple could do more to spend it's hoard, but I'd rather they spent it on making the Mac line even more awesome and also dedicating a ton of $$ on making the software line the very best there is. Couldn't do any harm and could do a lot for the PR of Apple.
I mean who really wanted a 'thinner' iMac?
Quote:
Originally Posted by GQB
Oh wow! A whole YEAR?!!
Which means he bought high and is pissed about his own poor judgement. Poor baby.
They claim to have significant investments in Apple dating back to 2010 rather than just a year ago.
There's also some discussion that his letter may have been prompted as much by Braeburn Capital.
http://www.zerohedge.com/news/2013-01-27/600-billion-trades-four-years-how-apple-puts-even-most-aggressive-hedge-funds-shame