I know it's just a fantasy, but it would be so cool if Apple could buy all the shares, go private, forget about the scum infested "market" at all, and leave Wall street behind.
Nuh uh! These armchair CEOs that have never run a business, let alone a massively profitable multinational business, in their life are clearly more competent than Tim Cook! If Apple's BoD was smart they'd install Red Oak and matrix07 as the co-CEOs of the company. Apple's stock would then be up to a billion dollars per share in no time! /s
For a handful of reasons, some good, some dubious. The good ones include: (1) putting your money where your mouth is, thereby credibly signaling to the market that your stock is undervalued, since you think your own stock is a great investment even if the market does not; (2) buying stocks 'low' to keep as treasury stock for future employee option exercises, so as to mitigate future dilution for existing shareholders; (3) returning money in a tax-efficient way to investors; (4) doing an equity-for-debt swap to make a capital structure change -- i.e., take on debt to buy back shares.
The dubious ones include: (1) trying to boost reported EPS with the expectation that will enhance market value; (2) greenmail (i.e., targeted repurchases, like Yahoo did with Loeb a couple of days ago); (3) attempting to take shares out of circulation to minimize chances of being taken over.
Why is dubious (3) more dubious than good (3)?
It depends on whether you believe maximizing shareholder value is a good thing or not. 'good (3)' does, 'dubious (3)' does not.
Very nice, guys. Are you unemployed since you two spend a lot of time here as well?
Ever heard of "if you have nothing good to say ..."
I spend a lot of time here? You can look through my history to see that on most days I do post I don't post on the forums more than a handful of times. Many days, not even at all.
I know it's just a fantasy, but it would be so cool if Apple could buy all the shares, go private, forget about the scum infested "market" at all, and leave Wall street behind.
On the concall, TC discussed that since the buyback program unfolds over time, the average re-purchase price would be reported at the program's end, as if it were executed by "dollar cost averaging". Perhaps this has gone out of style, but can't Apple's Braeburn subsidiary use "zero-cost collar" options to hedge share retirement at a fixed price, similar to foreign currency hedging? This would only make sense if the option premiums are reasonable, and if the 400ish price is about as low as AAPL gets for a couple of years. A disadvantage might be that it could be harder to "tune" a buyback to boost a quarterly EPS estimate.
How does one take itself private though? Would Apple goes to the bank and take on hundreds of Billion of debt, then knocking on most of those >5% institution. And buy the rest from Open Market?
Assuming that is even possible ( Apart from government i dont know if Banks even have have that many billions to lend out ) , Who would be the actual owner of Apple then?
On the concall, TC discussed that since the buyback program unfolds
over time, the average re-purchase price would be reported at
the program's end, as if it were executed by "dollar cost averaging".
Perhaps this has gone out of style, but can't Apple's Braeburn subsidiary
use "zero-cost collar" options to hedge share retirement at a fixed price,
similar to foreign currency hedging? This would only make sense if
the option premiums are reasonable, and if the 400ish price is about
as low as AAPL gets for a couple of years. A disadvantage might be
that it could be harder to "tune" a buyback to boost a quarterly EPS estimate.
The expected value of the difference between this strategy and the straight buyback is zero if options are fairly priced. It is difficult to believe -- in such a liquid, widely-held stock such as AAPL -- that they are not.
Why would you think option premiums would be mispriced (in Apple's favor)!?
Comments
[B]IPO: Known as prostitution, or publicly exposing yourself, by any other definition.[/B]
I know it's just a fantasy, but it would be so cool if Apple could buy all the shares, go private, forget about the scum infested "market" at all, and leave Wall street behind.
Hey, I run my own business. Thanks for asking.
Quote:
Originally Posted by matrix07
Hey, I run my own business. Thanks for asking.
Lemonade stand? Paperboy route? Anything remotely like a multinational Fortune 100 company?
Business must be quiet.
You spend a lot of time on the forums...
Nope. Nothing close to lemonade stand either. Nice try though.
Quote:
Originally Posted by MikeJones
Lemonade stand? Paperboy route? Anything remotely like a multinational Fortune 100 company?
Quote:
Originally Posted by GTR
Business must be quiet.
You spend a lot of time on the forums...
Very nice, guys. Are you unemployed since you two spend a lot of time here as well?
Ever heard of "if you have nothing good to say ..."
Hey. Hey. We always have time for something we like, don't we all?
Quote:
Originally Posted by ankleskater
Quote:
Originally Posted by anantksundaram
For a handful of reasons, some good, some dubious. The good ones include: (1) putting your money where your mouth is, thereby credibly signaling to the market that your stock is undervalued, since you think your own stock is a great investment even if the market does not; (2) buying stocks 'low' to keep as treasury stock for future employee option exercises, so as to mitigate future dilution for existing shareholders; (3) returning money in a tax-efficient way to investors; (4) doing an equity-for-debt swap to make a capital structure change -- i.e., take on debt to buy back shares.
The dubious ones include: (1) trying to boost reported EPS with the expectation that will enhance market value; (2) greenmail (i.e., targeted repurchases, like Yahoo did with Loeb a couple of days ago); (3) attempting to take shares out of circulation to minimize chances of being taken over.
Why is dubious (3) more dubious than good (3)?
It depends on whether you believe maximizing shareholder value is a good thing or not. 'good (3)' does, 'dubious (3)' does not.
In my view, anything that does not is dubious.
Quote:
Originally Posted by StruckPaper
Very nice, guys. Are you unemployed since you two spend a lot of time here as well?
Ever heard of "if you have nothing good to say ..."
I spend a lot of time here? You can look through my history to see that on most days I do post I don't post on the forums more than a handful of times. Many days, not even at all.
Quote:
Originally Posted by GTR
Business must be quiet.
You spend a lot of time on the forums...
GTR
Joined: May 2011
Posts: 1,860
Quote:
Originally Posted by herbapou
Then how did they increase the Cash Hoard by 1.9 millions from last quarter? Borrowed money from the bonds?
You got it.
Apple issued $17B in new debt last quarter (and spent about the same amount returning money to shareholders).
But I like my dividends!
over time, the average re-purchase price would be reported at
the program's end, as if it were executed by "dollar cost averaging".
Perhaps this has gone out of style, but can't Apple's Braeburn subsidiary
use "zero-cost collar" options to hedge share retirement at a fixed price,
similar to foreign currency hedging? This would only make sense if
the option premiums are reasonable, and if the 400ish price is about
as low as AAPL gets for a couple of years. A disadvantage might be
that it could be harder to "tune" a buyback to boost a quarterly EPS estimate.
Assuming that is even possible ( Apart from government i dont know if Banks even have have that many billions to lend out ) , Who would be the actual owner of Apple then?
Quote:
Originally Posted by retiarius
On the concall, TC discussed that since the buyback program unfolds
over time, the average re-purchase price would be reported at
the program's end, as if it were executed by "dollar cost averaging".
Perhaps this has gone out of style, but can't Apple's Braeburn subsidiary
use "zero-cost collar" options to hedge share retirement at a fixed price,
similar to foreign currency hedging? This would only make sense if
the option premiums are reasonable, and if the 400ish price is about
as low as AAPL gets for a couple of years. A disadvantage might be
that it could be harder to "tune" a buyback to boost a quarterly EPS estimate.
The expected value of the difference between this strategy and the straight buyback is zero if options are fairly priced. It is difficult to believe -- in such a liquid, widely-held stock such as AAPL -- that they are not.
Why would you think option premiums would be mispriced (in Apple's favor)!?
Quote:
Originally Posted by anantksundaram
In my view, anything that does not is dubious.
That I agree with.
Quote:
Originally Posted by Tallest Skil
They're taking themselves private!
I dont buy that. But I can see how this is interesting on a "conspiracy theory" level.