Preferred stock seen as Apple's chance to 'seize the opportunity' and reverse losses

245

Comments

  • Reply 21 of 81

    Quote:

    Originally Posted by wozwoz View Post



    Current dividend is perfectly fine. Apple's stock only started going down AFTER they started paying out dividends. I think the current dividend payout is just perfect. The idiot who started the law suit should be left to waddle in his own incompetence.


    Post hoc ergo propter hocApple announced the dividends in March 2012, paid the first one in July and, climbed to $700 in September, and crashed to $450 where it is now. And the dividend is responsible for the crash?


     


    You cannot begin to understand the frustration of being an Apple shareholder. The company is being bashed on the daily basis, which I frankly question: “what’s wrong?” Yesterday there was a rumor of Foxconn hiring freeze, which was quickly translated to Apple cutting production for iPhone 5 due to slow demand. Even after it was clarified by another Foxconn PR person that it was due to better than expected employee retention rate, the stock still performed badly.


     


    What’s more frustrating is Apple’s management denial that there is a problem with the shareprice. Time after time, Tim Cook said that he wants to focus on delivering great products; Wall Street will follow later. What he fails to recognize is Apple the brand is being tarnished, it’s being ridiculed as not cool enough, that users are abandoning it. Steve Jobs hated Wall Street and would have done the same, but he would have defended the brand to his last breath. Tim Cook and the Board of Director have so far come across as arrogant and oblivious to shareholder concerns. After all, they don’t own the business, the shareholders do.


     


    If you own a business with a fortress-like balance sheet, large pile of cash, strong brand recognition, but you are refused a loan at the bank because concerns over growth or competitors eating up your lunch, how would you feel?

  • Reply 22 of 81
    bwikbwik Posts: 562member


    Watch men who create nothing froth at the mouth for Apple's worth and credibility.  Apple was originally run by a man who created things.  That is what creates true wealth and value.  You can engineer Apple's balance sheet to hell and back and it won't add one cent of fundamental value.  MBAs should be running pencil factories and selling breakfast cereal.  Apple's business model is anti-MBA and that has been the source of its value.  Watching Apple end that innovative run is a little sad.

  • Reply 23 of 81
    I urge Apple management to pay attention to the mistakes of other firms in Silicon Valley, such as HPQ. Desperate acquisitions just to look good on paper have been shown to destroy share holder's value. The Einhorn move smells of desperation on his part. I prefer Apple use the extra funds to reduce the number of shares on the market. Reducing the float has worked well for companies like IBM. For the off shore funds, careful small acquisitions focusing on software would be advisable. Apple should acquire the companies and talent involving the start ups apps that we all tend to use frequently. Acquire Fantastical, Evernote, Addappt, Opera, and any other app company that succeeds in the market.
  • Reply 24 of 81
    jragostajragosta Posts: 10,473member
    Speaking of stupid, did you really have to cite the whole article, graphics included?
    What’s more frustrating is Apple’s management denial that there is a problem with the shareprice. Time after time, Tim Cook said that he wants to focus on delivering great products; Wall Street will follow later. What he fails to recognize is Apple the brand is being tarnished, it’s being ridiculed as not cool enough, that users are abandoning it. Steve Jobs hated Wall Street and would have done the same, but he would have defended the brand to his last breath. Tim Cook and the Board of Director have so far come across as arrogant and oblivious to shareholder concerns. After all, they don’t own the business, the shareholders do.
    [/quote]

    None of that is true. Just to point out a few errors:

    1. Jobs ignored Wall Street, too. In fact, Cook has been significantly more willing to share information than Jobs. And I don't see any sign that Cook is defending Apple's brand any less than Jobs. In fact, his openness to sharing more information seems to be directed at reinforcing the brand. Since Jobs didn't do that, it could be argued that Cook is doing more to defend the brand than Jobs did.

    2. Cook is entirely right to focus on the business. That does more for the value of the company (at least in the long run) than trying to manipulate stock.

    3. Cook and the board of directors ARE significant owners of Apple. Not entirely, but they own more shares than 99+ % of shareholders.

    4. Even if Cook and the Board didn't own any AAPL, their job is to maximize the value of the company. They do that by focusing on operations and new products. Playing games with the stock manipulators does absolutely nothing to enhance the value of the company.

    5. Cook and the Board are not oblivious to shareholder concerns. They address them in every conference call. More importantly, they started issuing a dividend last year in response (at least partially) to shareholder concerns.
  • Reply 25 of 81

    Quote:

    Originally Posted by zoffdino View Post


    ... Tim Cook and the Board of Director have so far come across as arrogant and oblivious to shareholder concerns. After all, they don’t own the business, the shareholders do. ...



     


    Actually, neither the shareholders nor the BoD own Apple. Apple, as a corporation, owns itself. The BoD members don't, as a function of being on the Board, own anything. All the shareholders own are stocks issued by Apple, not Apple itself.


     


    Perhaps the term 'shareholder' is the source of confusion here. It would be better to call them 'stockholders' since 'share' just means that, stock, not a part of the company.

  • Reply 26 of 81
    I agree, wall street can go to hell. Apple don't need them imho. How did any of those muppets help Apple in the grey days? Btw, I'm a small AAPL shareholder and I'm more than happy for Apple to do what Apple decide. I'd rather Apple had a large war-chest than give it all away to short-term speculators that will just sell and take the cash.
  • Reply 27 of 81
    Preferred stock holders owns a percentage of equity of the company, but no voting power.

    Common stock holders have no equity ownership, but has voting power.

    Both still earns dividends.
  • Reply 28 of 81
    This stock is a toxic dog and all the financial wrangling in the world isn't going to change a thing. If investors see the current stock as unworthy of their attention, then I think they should just go invest in other stocks. They have no interest in Apple, they just want to make quick money. Wall Street already believes Apple is going to fail. They've said it enough times. The news media says the same thing over and over again. Let's see they're right. Apple should continue to pay a small dividend and leave the bulk of cash alone. If the claims are true that Apple will be destroyed by Samsung and Android, then Apple should just hold onto all that reserve cash to survive a bit longer.

    It will be interesting exactly how big a pile they'll make. Maybe they'll be able to buy up all the companies that Wall Street thinks are so much better buys than Apple is. Apple should tell all the hedge funds to go to hell. They're nothing but leeches and parasites. As a long-term shareholder I'm already resigned to take the dividends because Apple's share price will never go up again to former levels. In Wall Street's minds, Apple can't beat the likes of Google, Amazon, Netflix, LinkedIn, etc., so that's all there is to it. Apple will never be able to have a P/E in the 600s, 800s or 3500s. It will just have to continue to make money the old fashioned way to hold even a little bit of its share value.
  • Reply 29 of 81

    Quote:

    Originally Posted by anonymouse View Post


    Actually, neither the shareholders nor the BoD own Apple. Apple, as a corporation, owns itself. The BoD members don't, as a function of being on the Board, own anything. All the shareholders own are stocks issued by Apple, not Apple itself.


     


    Perhaps the term 'shareholder' is the source of confusion here. It would be better to call them 'stockholders' since 'share' just means that, stock, not a part of the company.



    Apologies, but your post does not make any sense to me.


     


    Let me ask you this: If you bought a house with your own money, does the house belong to you?

  • Reply 30 of 81


    I have been saying this for six months now: what Apple needs to announce is a one-time $40B share repurchase, which can be funded by cash in the US. Don't increase dividends. (None of the 'GOUPS' nonsense either.)


     


    Why?


     


    For at least five reasons: (i) Positive signal about future cash flow prospects ("We think our own stock is seriously undervalued and hence a good investment, even if you don't think so, and I am willing to put our money where our mouth is"); (ii) It is more tax efficient way to return cash to investors; (iii) Keeping it as treasury stock mitigates future dilution from employee stock option exercises; (iv) It silences -- at least temporarily -- the 'value' investors who are constantly demanding cash back; (v) It mitigates the temptation for wasteful acquisitions (not that Apple would be that foolish, but why take the chance.....).

  • Reply 31 of 81
    Brian white. Making noise again. Yet no substance to his writings. Time for mr white to become an analyst not an anal-ist.
  • Reply 32 of 81
    Apple is doomed. Preferred stock is their LAST CHANCE at relevance.
  • Reply 33 of 81
    MacProMacPro Posts: 18,141member
    woodbine wrote: »
    Debt: the slippery road to being owned by Wall street

    Exactly. Hence their wish to do this ...
  • Reply 34 of 81
    bwikbwik Posts: 562member


    Share buybacks are theoretically ideal.  But in a sentiment driven market, buybacks can backfire.  What if Apple soaked its money into $500/sharre and it went down to $200/share?  The money would be gone with zero value created.  That's because sentiment and faith are still a big part of the stock at $500/share.  


     


    We have no idea how Apple will make money in 2015-2020.  Just no idea.  I'm not saying they won't, but they will have to start innovating.  Otherwise they are no different from a breakfast cereal company -- all advertising, packaging and zero high tech creativity.  As a low profit commodity producer, Apple is worth $200/share.


     


    I'd much rather see them buy Exxon stock with that money.  Pull a Warren Buffet with that shit.  

  • Reply 35 of 81

    Quote:

    Originally Posted by anantksundaram View Post


    Apologies, but your post does not make any sense to me.


     


    Let me ask you this: If you bought a house with your own money, does the house belong to you?



     


    Let me ask you this: Is a house a corporation?

  • Reply 36 of 81
    igrivigriv Posts: 1,177member

    Quote:

    Originally Posted by mvigod View Post



    Apple knows it needs all that money to survive the coming competition and margin compression


     


    That's sort of true. Apple could reduce the margins to zero, and still be able to meet payroll for easily a decade. That would certainly gain a lot of market share, but note that so far, apple has not been doing any of that (for example, since most of their revenue on the iPhone is on the back end, with carrier kickbacks, dropping the upfront cost to $99 would not hurt them too badly). It's the confusion that's the problem: the money is sitting in a sock, where it is getting eroded by Fed money printing, and not being used for it is used for. Einhorn is right in the sense that Apple should describe a credible strategy (and notice that Apple R&D costs, while quite healthy in absolute terms, are a small percentage of their profit),and if they have no credible business strategy, just give them money back to the shareholders.


     


    By the way, both OS X and iOS have their share of bugs, so apparently apple is not willing to spend their money even on quality assurance.

  • Reply 37 of 81
    igrivigriv Posts: 1,177member

    Quote:

    Originally Posted by bwik View Post


    Share buybacks are theoretically ideal.  But in a sentiment driven market, buybacks can backfire.  What if Apple soaked its money into $500/sharre and it went down to $200/share?  The money would be gone with zero value created.  That's because sentiment and faith are still a big part of the stock at $500/share.  


     


    We have no idea how Apple will make money in 2015-2020.  Just no idea.  I'm not saying they won't, but they will have to start innovating.  Otherwise they are no different from a breakfast cereal company -- all advertising, packaging and zero high tech creativity.  As a low profit commodity producer, Apple is worth $200/share.


     


    I'd much rather see them buy Exxon stock with that money.  Pull a Warren Buffet with that shit.  



    If Apple says "We think XON is a better buy than AAPL in today's market", what do you think this will do to sentiment? One of the points of a buyback is to express confidence in your own company.

  • Reply 38 of 81
    igrivigriv Posts: 1,177member

    Quote:

    Originally Posted by bleh1234 View Post



    Preferred stock holders owns a percentage of equity of the company, but no voting power.



    Common stock holders have no equity ownership, but has voting power.



    Both still earns dividends.


     


    Common stock holders HAVE equity ownership. What are you talking about?

  • Reply 39 of 81
    igrivigriv Posts: 1,177member

    Quote:

    Originally Posted by aderutter View Post



    I agree, wall street can go to hell. Apple don't need them imho. How did any of those muppets help Apple in the grey days? Btw, I'm a small AAPL shareholder and I'm more than happy for Apple to do what Apple decide. I'd rather Apple had a large war-chest than give it all away to short-term speculators that will just sell and take the cash.


     


    Apple was almost 100% funded by venture capital firms, and Markkula (their first chairman) was a venture capital guy. They survived their "grey days" because Gil Amelio (among other things) managed to line up a line of credit. So, don't knock the money guys.

  • Reply 40 of 81
    igrivigriv Posts: 1,177member

    Quote:

    Originally Posted by bwik View Post


    Watch men who create nothing froth at the mouth for Apple's worth and credibility.  Apple was originally run by a man who created things.  That is what creates true wealth and value.  You can engineer Apple's balance sheet to hell and back and it won't add one cent of fundamental value.  MBAs should be running pencil factories and selling breakfast cereal.  Apple's business model is anti-MBA and that has been the source of its value.  Watching Apple end that innovative run is a little sad.



    "Apple's business model is anti-MBA"??? Maybe you should lay off the Kool-Aid.

Sign In or Register to comment.