Buying back stock without the intention of taking the company private all the way is a nonsensical Wallstreet move. Nothing is gained, no value is added from a perspective of the company. And that's the perspective I like to have when I make decisions concerning my investments.
Love the watch - love the Health aspect/exercise tie in - love Ives input that there will be LOVE THE ECOSYSTEM TIE-IN.
Love Apple TV
Love the larger phones coming for 50+ people and Trump.
Love the Ipads coming in varying and larger sizes.
I love where we are going.
I don't need a larger dividend - I think it is stupid - its dumped out of the company w/ no return. I just reinvest 100% of dividend in new stock - its in retirment accounts so no tax impact. But not same for others. Buyback is an investment in Apple - which I believe.
Go Carl - you and I FULLY believe in Cook and Apple - just not their use of the cash. We say invest it in Apple.
People are saying you are disloyal or out for a quick short billion. Contrary o' stupid ones - we are fully into Apple and its investment in Apple - WAKE UP DON'T BE STUPID
You are not "disloyal" per that dim-wit Cal pers speaker today (how much have they lost for California retirees?????? ZILLIONS - THEY ARE STUPID) ........if you are suggesting to Cook to invest in Apple - while he is doing great things with product and future growth - there are 2 parts to business - that part and Carl's focus
wow. icahn disclosed his first buy of appl in the middle of august, 2013. appl was at just under 500 then. where are you getting 300? icahn is no savior.
there is no watch. it's a rumour.
i've known people who talk the way you write and they're all deluded. i doubt you have 900K reaL dollars worth of appl. maybe more like 9.00.
"Buying back that much stock is a cheap parlour trick to artificially boost the price in the short term. Once the market corrects and guys like Carl have sold off all their shares then the price goes into free fall. Plus your taking 50B off the table that could be used for long term growth."
Sorry, but you're just flat out wrong. Twice over.
First, buying back stock when it is below intrinsic value increases the value of all remaining shares. Period. And if AAPL at about 10X free cash flow net of cash isn't waaay below IV, selling now and walking away is the answer.
As far as not having the $50B around "for long term growth" is utter nonsense. That would still leave them over a $100,000,00,000, with another $40,000,000,000 flowing in every year. They can't even spend 20% of that in any conceivable scenario...except a huge acquisition. And that kind of acquisition would almost certainly destroy a large chunk of value.
For you to ignorant of this is sad enough. For the CEO of the world's largest business to do so is scary.
"Buying back that much stock is a cheap parlour trick to artificially boost the price in the short term. Once the market corrects and guys like Carl have sold off all their shares then the price goes into free fall. Plus your taking 50B off the table that could be used for long term growth."
Sorry, but you're just flat out wrong. Twice over.
First, buying back stock when it is below intrinsic value increases the value of all remaining shares. Period. And if AAPL at about 10X free cash flow net of cash isn't waaay below IV, selling now and walking away is the answer.
As far as not having the $50B around "for long term growth" is utter nonsense. That would still leave them over a $100,000,00,000, with another $40,000,000,000 flowing in every year. They can't even spend 20% of that in any conceivable scenario...except a huge acquisition. And that kind of acquisition would almost certainly destroy a large chunk of value.
For you to ignorant of this is sad enough. For the CEO of the world's largest business to do so is scary.
It increases the value on paper, but that is meaningless. Look at Apple now, on paper, it is wholly undervalued. Its valuation based on earnings should have the stock price per share over a thousand dollars. Apple buying back stock only increases the share value while it and others are buying. It takes very little to bring the share price down because the share price is completely related to how many people are buying and selling the remaining shares. If more of the remaining people are selling than buying, the price will drop. Only one thing is guaranteed by Apple buying back huge amounts of its stock. Namely, it will overpay and get nothing in return as it will retire the stock (not hold it to sell later).
The only true way to reward long term investors is to pay an appropriate dividend and to keep innovating.
I thought a major part of the reason for the cash hoard is to avoid re-patriating cash and losing it to taxes.
Correct me if I am wrong.
If not, then how is it in the best interest of the shareholders to bring it back now and lose such a massive piece of it to the government?
Also, If you're going to make statements about what AAPL should or should not do with its money, make sure you post how many shares you own so the rest of us can determine exactly the type of knowledgeable (or not) player you are.
I own 250 sharesand I still don't fully understand the ramifications of whats going on, but if Ichan can show 26% returns, then those of you who show less should shut up now.
I don't care to see CalPERS or anybody yielding under 20% open their mouth.
I will not disclose my position, as that is meaningless, but I have held Apple since Steve Jobs has come back to the company. It has undergone two stock splits, and is now paying a dividend.
As far as a twenty percent return goes, that number is meaningless. Twenty percent over what time period? Calipers is showing a seven percent per year return on its investments. That is im,pressive and above average in these times when banks are paying less than a percent on investments.
So what would stockholders liked changed about the way Apple is doing business? Personally I would rather have the dividend boosted to 5%, which would provide a longer-term incentive than a single buyback.
I don't think they need to issue a stock split. Investors keep thinking that Apple needs more investors when it's the opposite. Apple doesn't need any more money farmers sharing in their already successful company. They need as few of those as possible. Look at Berkshire Hathaway's stock price. If anything, they should do a stock merge and try to lower the trading frequency in order to keep it more stable. It has the downside of appealing more to people who can benefit from short-term investment but few of the companies with multi-billion dollar investments will pull in and out on a whim as there's few safer places to put their money. Apple's financials are rock solid. It doesn't matter if they aren't growing, they are holding well at very high levels.
We need directors who can address the big money pile not with short-term buyback strategies that facilitate extraction of value but with long-term strategies that create value. Investing $150B in Treasuries or money markets is not efficient use of our money. The returns of Google Ventures, for example, are far above the industry's mean.
Google Ventures might look good but part of that is down to Google. Google Ventures invested in Nest and Google buying them netted a 20x return for the likes of Google Ventures, kinda silly though as Google is their parent company:
I don't need a larger dividend - I think it is stupid - its dumped out of the company w/ no return. I just reinvest 100% of dividend in new stock - its in retirment accounts so no tax impact. But not same for others. Buyback is an investment in Apple - which I believe.
If you reinvest the dividend then your stock holding goes up same as with a buyback. The problem isn't really the buyback but the urgency to increase it. If Apple's value (market cap) goes up then the stock price will go up anyway. While some see that as a missed opportunity, they are taking shares off the table so how does Apple get the value out of it? All it would take is for some crazy rumors to float around about Apple not doing so well or an earnings slip and traders will drop the trading price back down and all of those assets spent on the buyback vanish into nothing. Apple can't then use that lack of assets to grow the company later on when an opportunity comes up.
If Apple is undervalued and they don't increase the buyback, the stock price will go up on its own (a higher dividend might help that as it's a guaranteed higher return) and Apple will retain their assets for growth - everybody wins.
If Apple is undervalued and they do increase the buyback, Apple doesn't benefit much relative to the billions spent but their staff stockholdings go up and investors benefit. It can crash back down very easily though and lose all of that investment.
If Apple isn't undervalued (they have the highest company valuation in the entire world remember) and they don't increase the buyback, not increasing it will have been the sensible thing to do.
If the stock hasn't gone up in a year, they can increase the buyback when they have more income. If people are in it for the long-term, what's the rush to increase the buyback?
The guy owns 0.787% of Apples current market cap, he should come back with some serious money, then he can have a say.
Actually, all you need to own is 1 share to AAPL to be heard. It was the reason why Steve Jobs sold all but 1 share of his holding in AAPL stock. He did this twice. Once when he was ousted from Apple and again when he thought the Apple board was heading in the wrong direction with regards to making Apple profitable again. This after Apple bought out NeXT and paid him with 1.5M shares of AAPL. The 1 share gave him the right to attend Apple shareholder meetings and be heard. Though I doubt Apple board would pay much attention to anybody else with 1 share.
Saying that all buy backs are a gimmick shows your absolute ignorance about finance.
I'm absolutely shocked how many people in this forum have close to zero knowledge about finance. And the worst part is there are a bunch of finance professionals here, yet people refuse to listen to us. As a finance professional I advise all the Ichan haters to separate the man from the plan.
No, what you don't understand is that these people are fed up with watching short sighted Wall Street bastards dictate the actions of companies by way of a stake that is based on nothing but stock and the greed to utilize it to stockpile yet more wealth, rather than actually giving a damn about the company, its products, and its customers. The outrage is clearly based on Icahn's greed-focused domineering behavior, not on his so-called investment smarts.
The matter of what Apple does with its cash hoard has very little to do with the company, its products, or its customers, whichever side you agree with. This is about corporate finance and maximising return to shareholders, not Macs and iDevices.
Apple [B]do not need[/B] such a large cash pile, that is apparent; the only argument is what the best use for it is.
Sorry if a repost, but Icahn has $4.1 billion invested in AAPL, not $3.6 billion. And he's basically right about the buyback by the way - this coming from a financial analyst.
The matter of what Apple does with its cash hoard has very little to do with the company, its products, or its customers, whichever side you agree with. This is about corporate finance and maximising return to shareholders, not Macs and iDevices.
Apple do not need such a large cash pile, that is apparent; the only argument is what the best use for it is.
Spoken like a true Wall Street shill. If they still taught the theory of value creation in Business school instead of arm chair day trading the world would be a much better place. All these "experts" taking about share price like its a tangible meaningful thing are delusional.
What happens when all these hedge funds and investment banks run out of money to reallocate because the well tried up?
Real finance professionals like myself know the key is value creation and sound operations, not pie in the sky share prices.
Carl, though not in Apple as long as myself, has politely purchased over $4 Billion of Apple stock. His investment has brought the stock back from the high $300s to $510. He has politely encouraged Mr. Cook (who I personally admire for management, and what I believe will be introducing OUTSTANDING product this year) to do productive financial adjustments for the Shareholders (one of them me - one of the most loyal users for about 30 years), and future employees/engineers that I want Apple to get as a Shareholder (hopefully my children in 10 years - who are on track to work for a great company like Apple if they keep it up - not exag.). You get employees by having a growing company, good environment, and $$ (a large portion of which is appreciating stock).
The price of Apple stock (growth) is critical to all you non-knowers. Stock options are granted based on the current price of the stock when the options are issued. Growth in the price of shares gives a "stake" to the young brilliant engineers - so they work on "the good side" (Apple), rather than a "Google" - where the stock has "been ripping".
So don't be arrogant and think that stock appreciation means nothing "to long term thinkers". As much as I love Apple - it will not be here for my kids to work unless stock price grows (product and appreciation of share growth) - we will only get the "inferior" graduates of Standford and Cal. - get it??????????
Clearly some of you are clueless as to the value of buy-backs. If you have faith in the growth/products at your company - such as I do with Apple and Cook - then you spend excess cash by reducing the stock count. Price will go up because fewer people were issued shares (fewer shares outstanding) - and the remaining shareholders (me and Carl) will own more of the growth. We also get rid of a bunch of flaky shareholders that are scared and not devoted like me and many of you AND CARL.
If Carl was doing this as a 6 month effort to score billions - he would not be using prec./friendly language - he would want binding language in this resolution. He is not.
I have $900K (plus50+ options) - in Apple - and I am voting for Carl (which is not contradictory to fully supporting Tim Cook which I do).
Also - a good move would also be for Apple to split this stock into the Disney price range - and let the buyers of its products participate - they will not (constantly I have heard this) .. even though they can buy 1 share, 2 shares et al instead of 50 at $50 - Buy back ideal - buy back and stock split so Apple becomes the "people's stock" would be Nirvana
Your arguments are full of errors and contradictions.
Apple is a growing company with a first class working environment and plenty of money to pay new employees. They grow by introducing new products in new markets, not by artificially pumping the stock. Why would they trade assets for liabilities to just to increase the stock's price, only to have to issue more shares when it comes time raise capital to develop and market new products? The consumer market Apple serves can be fickle, they may need those liquid assets to survive their doldrums.
Would not stock options in AAPL, widely known to be undervalued, be more attractive to young brilliant engineers working on the next big thing to help AAPL grow?
I would not want to be an engineer with options in Twitter right now.
Carl Icahn is only being polite because he knows there are many shareholders than are as emotionally invested in Apple as they are financially, perhaps more so. Arrogance on his part would be counter-productive to his goal. BTW crediting his investment with the bounce in the stock's price last year is pure fantasy.
And who are you to say what they do and don’t need? :no:
Someone with an opinion, who are you?
Where is the evidence that Apple needs such a bulging bank account when it's very clear that they've put it to no effective use for the past few years? Gathering a few measly percent interest in a security is not a good use, the opportunity cost is massive - if they'd bought back more in the mid-$400s they'd have made double digits by now. That's mathematics.
Spoken like a true Wall Street shill. If they still taught the theory of value creation in Business school instead of arm chair day trading the world would be a much better place. All these "experts" taking about share price like its a tangible meaningful thing are delusional.
What happens when all these hedge funds and investment banks run out of money to reallocate because the well tried up?
Real finance professionals like myself know the key is value creation and sound operations, not pie in the sky share prices.
Why are you implicitly suggesting that there's a binary choice between a stock buy back and value creation and sound operations? The post of mine that you quoted was pretty clear in saying these with Apple's current wealth their financial management can mostly (bar what they need for cash flow and security) be considered a wholly different matter than their core business if they don't need the cash to operate (they don't) then they should do something else with it. I've got confidence that Apple can manage both sound operations and shareholder-friendly financial management.
We did this the other day when I used some rough figures to show that Apple can cover all operating costs and most if not all infrastructure investments, acquisitions and hires from cash flow. If you have some additional information about why Apple might need $150m in banked cash, please feel free to share. You didn't the other day.
If I had my way I would have bought back all $60B when the stock was at $380 but now its over $500. That lack of action has cost shareholders billions in lost value.
The act of buying $60b of shares is going to create momentum in raising the stock price. The buyback they have already done has helped the rise from $380 to $500.
Apple knows all about the suggestions and have commented on their position:
"The Company’s stock continues to experience substantial price volatility. Additionally, the Company, the technology industry, and the stock market as a whole have experienced extreme stock price and volume fluctuations that have affected stock prices in ways that may have been unrelated to these companies’ operating performance. Price volatility over a given period may cause the average price at which the Company repurchases its own stock to exceed the stock’s price at a given point in time. The Company believes its stock price reflects expectations of future growth and profitability.
The Company also believes its stock price reflects expectations that its cash dividend will continue at current levels or grow and that its current share repurchase program will be fully consummated. Future dividends are subject to declaration by the Company’s Board of Directors, and the Company’s share repurchase program does not obligate it to acquire any specific number of shares. If the Company fails to meet any of these expectations related to future growth, profitability, dividends, share repurchases or other market expectations its stock price may decline significantly, which could have a material adverse impact on investor confidence and employee retention.
The Company’s marketable securities investment portfolio is invested primarily in highly-rated securities and its investment policy generally limits the amount of credit exposure to any one issuer. The policy requires investments generally to be investment grade with the objective of minimizing the potential risk of principal loss.
In 2012, the Company’s Board of Directors authorized a program to repurchase up to $10 billion of the Company’s common stock beginning in 2013. In April 2013, the Company’s Board of Directors increased the share repurchase program authorization from $10 billion to $60 billion, of which $23.0 billion had been utilized as of September 28, 2013
During 2013, the Company repurchased 19.4 million shares of its common stock in the open market at an average price of $464.11 per share for a total of $9.0 billion. These shares were retired upon repurchase."
They've been buying about $2.5b per quarter. $23b already is about 50 million shares. They used to have 940 million outstanding shares and it's now 892m. There's no harm in buying back $2.5b per quarter and they could be doing this solely from US-based income leaving their other ~60% income overseas.
Comments
wow. icahn disclosed his first buy of appl in the middle of august, 2013. appl was at just under 500 then. where are you getting 300? icahn is no savior.
there is no watch. it's a rumour.
i've known people who talk the way you write and they're all deluded. i doubt you have 900K reaL dollars worth of appl. maybe more like 9.00.
There's a reason we bought the stock. I don't see any reason to abandon this investment position.
A lot of noise out there.
It's hard to hang in there, but the alternatives make me more nervous. Go bank of Apple!
Sorry, but you're just flat out wrong. Twice over.
First, buying back stock when it is below intrinsic value increases the value of all remaining shares. Period. And if AAPL at about 10X free cash flow net of cash isn't waaay below IV, selling now and walking away is the answer.
As far as not having the $50B around "for long term growth" is utter nonsense. That would still leave them over a $100,000,00,000, with another $40,000,000,000 flowing in every year. They can't even spend 20% of that in any conceivable scenario...except a huge acquisition. And that kind of acquisition would almost certainly destroy a large chunk of value.
For you to ignorant of this is sad enough. For the CEO of the world's largest business to do so is scary.
"Buying back that much stock is a cheap parlour trick to artificially boost the price in the short term. Once the market corrects and guys like Carl have sold off all their shares then the price goes into free fall. Plus your taking 50B off the table that could be used for long term growth."
Sorry, but you're just flat out wrong. Twice over.
First, buying back stock when it is below intrinsic value increases the value of all remaining shares. Period. And if AAPL at about 10X free cash flow net of cash isn't waaay below IV, selling now and walking away is the answer.
As far as not having the $50B around "for long term growth" is utter nonsense. That would still leave them over a $100,000,00,000, with another $40,000,000,000 flowing in every year. They can't even spend 20% of that in any conceivable scenario...except a huge acquisition. And that kind of acquisition would almost certainly destroy a large chunk of value.
For you to ignorant of this is sad enough. For the CEO of the world's largest business to do so is scary.
It increases the value on paper, but that is meaningless. Look at Apple now, on paper, it is wholly undervalued. Its valuation based on earnings should have the stock price per share over a thousand dollars. Apple buying back stock only increases the share value while it and others are buying. It takes very little to bring the share price down because the share price is completely related to how many people are buying and selling the remaining shares. If more of the remaining people are selling than buying, the price will drop. Only one thing is guaranteed by Apple buying back huge amounts of its stock. Namely, it will overpay and get nothing in return as it will retire the stock (not hold it to sell later).
The only true way to reward long term investors is to pay an appropriate dividend and to keep innovating.
Do you even know anything about CalPers?? it's the biggest retirement in the U.S. and I am proud of what they told Carl!!!!!
Amen. Calpers has the long term interest of its shareholders in mind. It knows what Carl is up to.
I thought a major part of the reason for the cash hoard is to avoid re-patriating cash and losing it to taxes.
Correct me if I am wrong.
If not, then how is it in the best interest of the shareholders to bring it back now and lose such a massive piece of it to the government?
Also, If you're going to make statements about what AAPL should or should not do with its money, make sure you post how many shares you own so the rest of us can determine exactly the type of knowledgeable (or not) player you are.
I own 250 shares and I still don't fully understand the ramifications of whats going on, but if Ichan can show 26% returns, then those of you who show less should shut up now.
I don't care to see CalPERS or anybody yielding under 20% open their mouth.
I will not disclose my position, as that is meaningless, but I have held Apple since Steve Jobs has come back to the company. It has undergone two stock splits, and is now paying a dividend.
As far as a twenty percent return goes, that number is meaningless. Twenty percent over what time period? Calipers is showing a seven percent per year return on its investments. That is im,pressive and above average in these times when banks are paying less than a percent on investments.
I don't think they need to issue a stock split. Investors keep thinking that Apple needs more investors when it's the opposite. Apple doesn't need any more money farmers sharing in their already successful company. They need as few of those as possible. Look at Berkshire Hathaway's stock price. If anything, they should do a stock merge and try to lower the trading frequency in order to keep it more stable. It has the downside of appealing more to people who can benefit from short-term investment but few of the companies with multi-billion dollar investments will pull in and out on a whim as there's few safer places to put their money. Apple's financials are rock solid. It doesn't matter if they aren't growing, they are holding well at very high levels.
Google Ventures might look good but part of that is down to Google. Google Ventures invested in Nest and Google buying them netted a 20x return for the likes of Google Ventures, kinda silly though as Google is their parent company:
http://techcrunch.com/2014/01/14/double-google-all-the-way/
But I agree they should be investing in something with growth. Their payment processing solution might be this.
If you reinvest the dividend then your stock holding goes up same as with a buyback. The problem isn't really the buyback but the urgency to increase it. If Apple's value (market cap) goes up then the stock price will go up anyway. While some see that as a missed opportunity, they are taking shares off the table so how does Apple get the value out of it? All it would take is for some crazy rumors to float around about Apple not doing so well or an earnings slip and traders will drop the trading price back down and all of those assets spent on the buyback vanish into nothing. Apple can't then use that lack of assets to grow the company later on when an opportunity comes up.
If Apple is undervalued and they don't increase the buyback, the stock price will go up on its own (a higher dividend might help that as it's a guaranteed higher return) and Apple will retain their assets for growth - everybody wins.
If Apple is undervalued and they do increase the buyback, Apple doesn't benefit much relative to the billions spent but their staff stockholdings go up and investors benefit. It can crash back down very easily though and lose all of that investment.
If Apple isn't undervalued (they have the highest company valuation in the entire world remember) and they don't increase the buyback, not increasing it will have been the sensible thing to do.
If the stock hasn't gone up in a year, they can increase the buyback when they have more income. If people are in it for the long-term, what's the rush to increase the buyback?
The guy owns 0.787% of Apples current market cap, he should come back with some serious money, then he can have a say.
Actually, all you need to own is 1 share to AAPL to be heard. It was the reason why Steve Jobs sold all but 1 share of his holding in AAPL stock. He did this twice. Once when he was ousted from Apple and again when he thought the Apple board was heading in the wrong direction with regards to making Apple profitable again. This after Apple bought out NeXT and paid him with 1.5M shares of AAPL. The 1 share gave him the right to attend Apple shareholder meetings and be heard. Though I doubt Apple board would pay much attention to anybody else with 1 share.
No, what you don't understand is that these people are fed up with watching short sighted Wall Street bastards dictate the actions of companies by way of a stake that is based on nothing but stock and the greed to utilize it to stockpile yet more wealth, rather than actually giving a damn about the company, its products, and its customers. The outrage is clearly based on Icahn's greed-focused domineering behavior, not on his so-called investment smarts.
Apple [B]do not need[/B] such a large cash pile, that is apparent; the only argument is what the best use for it is.
Sorry if a repost, but Icahn has $4.1 billion invested in AAPL, not $3.6 billion. And he's basically right about the buyback by the way - this coming from a financial analyst.
And who are you to say what they do and don’t need?
Spoken like a true Wall Street shill. If they still taught the theory of value creation in Business school instead of arm chair day trading the world would be a much better place. All these "experts" taking about share price like its a tangible meaningful thing are delusional.
What happens when all these hedge funds and investment banks run out of money to reallocate because the well tried up?
Real finance professionals like myself know the key is value creation and sound operations, not pie in the sky share prices.
Your arguments are full of errors and contradictions.
Apple is a growing company with a first class working environment and plenty of money to pay new employees. They grow by introducing new products in new markets, not by artificially pumping the stock. Why would they trade assets for liabilities to just to increase the stock's price, only to have to issue more shares when it comes time raise capital to develop and market new products? The consumer market Apple serves can be fickle, they may need those liquid assets to survive their doldrums.
Would not stock options in AAPL, widely known to be undervalued, be more attractive to young brilliant engineers working on the next big thing to help AAPL grow?
I would not want to be an engineer with options in Twitter right now.
Carl Icahn is only being polite because he knows there are many shareholders than are as emotionally invested in Apple as they are financially, perhaps more so. Arrogance on his part would be counter-productive to his goal. BTW crediting his investment with the bounce in the stock's price last year is pure fantasy.
I agree with you about the stock split.
Where is the evidence that Apple needs such a bulging bank account when it's very clear that they've put it to no effective use for the past few years? Gathering a few measly percent interest in a security is not a good use, the opportunity cost is massive - if they'd bought back more in the mid-$400s they'd have made double digits by now. That's mathematics.
Sure thing, bub.
We still haven't established that they are undervalued. If they are undervalued then why the recent drop?
The issue is the urgency. If he's not greedy, he can wait.
The act of buying $60b of shares is going to create momentum in raising the stock price. The buyback they have already done has helped the rise from $380 to $500.
Apple knows all about the suggestions and have commented on their position:
"The Company’s stock continues to experience substantial price volatility. Additionally, the Company, the technology industry, and the stock market as a whole have experienced extreme stock price and volume fluctuations that have affected stock prices in ways that may have been unrelated to these companies’ operating performance. Price volatility over a given period may cause the average price at which the Company repurchases its own stock to exceed the stock’s price at a given point in time. The Company believes its stock price reflects expectations of future growth and profitability.
The Company also believes its stock price reflects expectations that its cash dividend will continue at current levels or grow and that its current share repurchase program will be fully consummated. Future dividends are subject to declaration by the Company’s Board of Directors, and the Company’s share repurchase program does not obligate it to acquire any specific number of shares. If the Company fails to meet any of these expectations related to future growth, profitability, dividends, share repurchases or other market expectations its stock price may decline significantly, which could have a material adverse impact on investor confidence and employee retention.
The Company’s marketable securities investment portfolio is invested primarily in highly-rated securities and its investment policy generally limits the amount of credit exposure to any one issuer. The policy requires investments generally to be investment grade with the objective of minimizing the potential risk of principal loss.
In 2012, the Company’s Board of Directors authorized a program to repurchase up to $10 billion of the Company’s common stock beginning in 2013. In April 2013, the Company’s Board of Directors increased the share repurchase program authorization from $10 billion to $60 billion, of which $23.0 billion had been utilized as of September 28, 2013
During 2013, the Company repurchased 19.4 million shares of its common stock in the open market at an average price of $464.11 per share for a total of $9.0 billion. These shares were retired upon repurchase."
They've been buying about $2.5b per quarter. $23b already is about 50 million shares. They used to have 940 million outstanding shares and it's now 892m. There's no harm in buying back $2.5b per quarter and they could be doing this solely from US-based income leaving their other ~60% income overseas.