Why Apple, Inc decided to split its stock 7-1

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  • Reply 41 of 99
    mvigodmvigod Posts: 172member
    Quote:
    Originally Posted by SolipsismX View Post





    There is no 180° turn here. Cook didn't say they would never split the stock just to split it the next year. He stated Apple had been looking into it and would continue to look into. He also stated that with the "current information" it wasn't advantageous to them. Clearly the "new information" suggested it was now advantageous. Whether you agree with when the stock should have split or by how much is irrelevant to this fact. All you call do is opine that Apple waited too long and is too slow to react, but that is not fact, just an opinion. And why blame Cook as if Apple wasn't slow to move under Jobs reign where Apple was a good half-decade after first PMP and decades after the first mobile phone and tablet. Apple rarely acts impetuous which is a big reason I am a fan of the company.

     

    Sure he didn't say they would never do it BUT he did say this:  "And the current information we have would suggest that there's very little support that it helps the stock."

     

    So what changed from May 2012 and every quarter after that up until last week?  What new information did they have?  Was it possible the current information was all the same as it was in May 2012 (because guess what, it was) and Cook just interpreted the same information the wrong way back then.  He realized from the same information NOW that his old decision on that same information was 180 degrees wrong and flipped.  Good for him for finally doing it. Shame on him for not getting it right the first time.

     

    They simply felt they were above it and would win the special race to $1000/share.  Or perhaps they didn't understand the psychology of splits that they do today.  Had Cook read my letters it was all spelled out for him.  

     

     As a result lost the coveted race to $1000 (google won) and alot more.  The stock became a laughing stock and shunned by many.  Today it is still well off over 100/share from it's all time high (15%) which many argue at 700/share was STILL cheap. Today it continues to trade for a cheap valuation and Cook allowed the stock to be "broken".  It will always be a cheap stock based on valuation because of this mistake and lack of foresight.   I lost confidence in Cook and time will show why.  I'm an apple fan and user too so I should be biased in favor of Apple's future.  Been using macs and apple products since 1990.  I own 5 ipads, 3 iphones, ipad mini, several ipods, macbook and imacs.   It's actually as a user I see the holes in the boat now.

  • Reply 42 of 99
    solipsismxsolipsismx Posts: 19,566member
    mvigod wrote: »
    So what changed from May 2012 and every quarter after that up until last week? What new information did they have?

    Why don't you ask him?
     Was it possible the current information was all the same as it was in May 2012 (because guess what, it was)

    Can you prove that no information about Apple's financials and future has changed in TWO YEARS?! I can show you 7 quarterly results that were not available in May 2012.
    and Cook just interpreted the same information the wrong way back then.

    So you think it's more likely that you (with no information on the internal workings of Apple) are so brilliant that despite the hundreds, if not thousands, of people working in their accounting departments (with detailed numbers, the ability to run scenarios against those numbers, and with higher ups having access to what is coming down the pipe) that you know more than they do? That's seems grandiose to the extreme.
    As a result lost the coveted race to $1000 (google won) and alot more.

    Coveted race to $1000? No reasonable person covets such a thing.
    The stock became a laughing stock and shunned by many.

    Maybe believe 9/11 was a conspiracy but it doesn't make them any less nutty or wrong.
    Today it is still well off over 100/share from it's all time high (15%) which many argue at 700/share was STILL cheap. Today it continues to trade for a cheap valuation

    If you thought it was undervalued then it was foolish for you to sell.
    I lost confidence in Cook and time will show why.

    Despite the company's valuation being higher under Cook than any CEO.
    Been using macs and apple products since 1990.  I own 5 ipads, 3 iphones, ipad mini, several ipods, macbook and imacs.

    Ugh! You saying you own Apple products in no way makes you an expert on Apple's financial future, especially not over the people that are working within the company.
    It's actually as a user I see the holes in the boat now.

    It sounds like sour grapes to me; you got impatient and made a rash decision you're not regretting. You see holes despite Apple doing what you wanted them to do. Well I wanted Apple to remove the ODD several years before they did it, but that's because it was what I personally wanted. When they did I state that Apple was wrong for not doing it years earlier, I was simply glad they finally did it.

    Personally, I think all this a massive setup for a major new product category. I think Apple is playing a long game that is going to completely knock the rest of the industry off their feet within a year and suck up even more of the mindshare than they already have.
  • Reply 43 of 99
    jungmarkjungmark Posts: 6,926member
    pazuzu wrote: »
    At the end of the day this is no longer Steve Jobs' Apple.
    No new product line in 3 years and now a stock split.

    Congrats, your comment is still in the running to become America's Next dumb comment.
    mvigod wrote: »
    Too bad Cook waited so long.  I pleaded with him and Apple Investor relations in May of 2012 to split the stock.  
    ...

    When Apple announced earnings on Jan 23rd of 2013 and didn't announce a split I sold every share I owned after hours at the end of the conference call.  Did better still today in what I reinvested in even after paying the tax hit on the big gains I had.   It's just amazing the 180 Cook did and his lack of vision to pull the trigger ahead of time rather than so very late in the game.  I fear he will do this with other decisions and trends.  He's slow moving and slow to realize things in the future.  I truly believe he lacks a vision and understanding but who can blame him as he was an operating officer, not a visionary.

    Congrats, your comment is still in the running to become America's Next dumb comment.
    mvigod wrote: »
    Sure he didn't say they would never do it BUT he did say this:  "And the current information we have would suggest that there's very little support that it helps the stock."

    So what changed from May 2012 and every quarter after that up until last week?  What new information did they have?  Was it possible the current information was all the same as it was in May 2012 (because guess what, it was) and Cook just interpreted the same information the wrong way back then.  He realized from the same information NOW that his old decision on that same information was 180 degrees wrong and flipped.  Good for him for finally doing it. Shame on him for not getting it right the first time.

    They simply felt they were above it and would win the special race to $1000/share.  Or perhaps they didn't understand the psychology of splits that they do today.  Had Cook read my letters it was all spelled out for him.  

     As a result lost the coveted race to $1000 (google won) and alot more.  The stock became a laughing stock and shunned by many.  Today it is still well off over 100/share from it's all time high (15%) which many argue at 700/share was STILL cheap. Today it continues to trade for a cheap valuation and Cook allowed the stock to be "broken".  It will always be a cheap stock based on valuation because of this mistake and lack of foresight.   I lost confidence in Cook and time will show why.  I'm an apple fan and user too so I should be biased in favor of Apple's future.  Been using macs and apple products since 1990.  I own 5 ipads, 3 iphones, ipad mini, several ipods, macbook and imacs.   It's actually as a user I see the holes in the boat now.

    Stock buy backs, more cash in hand.

    As for this race to a $1000, that's the stupidest thing ever. Apple could have reversed split to reach that target if it was a meaningful goal.
  • Reply 44 of 99
    tundraboytundraboy Posts: 1,882member
    Quote:

    Originally Posted by rob53 View Post

     

    I believe so. My income tax rate will be much lower than a capital gains tax rate (unless I'm missing something). I'm in retirement mode so I'm not trying to get a huge annual income, only withdrawing enough to pay bills and enjoy life. This method also helps keeps my ACA health insurance costs down substantially. I'm not one of those people who is trying to die with the most amount of money, I'd just like to have enough to buy a few things and have some fun but not stress over everything.


     

    More power and fun to you then.  Someday when the kids are done with college, I hope to live the much simpler life that you are living.

  • Reply 45 of 99
    cynhgmcynhgm Posts: 5member
    "Google's split was designed to silence shareholder input by taking away their rights in exchange for nothing."

    I don't think the author really understands what happened there. That statement alone taints the entire article and turns it just into another fanboy piece.
  • Reply 46 of 99
    malaxmalax Posts: 1,598member
    Quote:

    Originally Posted by mvigod View Post

    When Apple announced earnings on Jan 23rd of 2013 and didn't announce a split I sold every share I owned after hours at the end of the conference call.  Did better still today in what I reinvested in even after paying the tax hit on the big gains I had.   It's just amazing the 180 Cook did and his lack of vision to pull the trigger ahead of time rather than so very late in the game.  I fear he will do this with other decisions and trends.  He's slow moving and slow to realize things in the future.  I truly believe he lacks a vision and understanding but who can blame him as he was an operating officer, not a visionary.


    LOL.  I don't know what the mvi part means, but obviously you are are a god among men.  Please write to the board asking them to appoint you in Cook's place.

  • Reply 47 of 99
    carthusiacarthusia Posts: 583member
    Silly question: What's the best way (easiest and with minimal fees) to buy several shares of AAPL? I'll consult a financial advisor, but this may be far simpler than I think.
  • Reply 48 of 99
    solipsismxsolipsismx Posts: 19,566member
    carthusia wrote: »
    Silly question: What's the best way (easiest and with minimal fees) to buy several shares of AAPL? I'll consult a financial advisor, but this may be far simpler than I think.

    Not a silly question. Cheapest and easiest way I know is to use an online broker.

    Some of them will also have deals for free trades, discounted rates, and other options based on the amount you open your account with.
  • Reply 49 of 99
    solipsismx wrote: »
    Personally, I think all this a massive setup for a major new product category. I think Apple is playing a long game that is going to completely knock the rest of the industry off their feet within a year and suck up even more of the mindshare than they already have.

    Sol, you may be right!

    There was a good discussion on another thread about how iPads are changing the way some people use computers:
    melgross wrote: »
    One of the problems here is I thinking that everything will remain the same except for the addition of touch. I don't believe that will be true. I would like the option, not the requirement. I now do a lot of work on my iPad that I ordinarily would do on my Mac Pro. That includes video and photo editing, CAD, etc. a bigger screen would make that all better.

    I don't see it as being out of the realm of possibility that apps on the Mac could have two UIs. You could make a choice, touch or keyboard. So if you slid the screen down to the almost horizontal position, you would choose the touch UI, and visa versa. I can see advantages in both.

    Being dogmatic either way isn't helpful. There's room for both.

    Even long-time users like @melgross are increasingly using iPads to perform tasks formerly reserved for laptop and some desktop computers -- and in the process, successfully using touch in lieu of mouse/kb.

    IMO, Apple hasn't quite solved the iPad UI/UX -- need an easier, more robust way to share data and files among apps and devices, need more convenient and granular way to manipulate the touch interface, etc. But, I think these are doable as the present tech evolves.

    Also, the [data] cost of always being connected needs to be addressed.

    Maybe what you are defining is a post post-pc personal [computer] appliance where the device assumes ones alter-ego.
  • Reply 50 of 99
    tallest skiltallest skil Posts: 43,388member
    Originally Posted by Scoopertino View Post

    Apple rethinks stock split, goes for more gusto

    Take that, Wall Street! Apple’s Board just rescinded its proposed 7:1 stock split, replacing it with something a bit more dramatic.

    How does 10,000:1 sound?

    Starting on June 7, a single share of AAPL will decrease in price from its 4/24/14 closing price of $594 to a little more than a nickel.

    Why the sudden turnaround?

    CEO Tim Cook says it’s all about making Apple stock more affordable to mainstream investors.

    “If the goal is to make AAPL more affordable, why dork around? Let’s get on with it,” says Cook in an Apple press release.

    According to sources, Cook became obsessed with penny stocks after he read an article about penny stock millionaires on a site called How Life Works. It’s a site he’s relied on in the past for fashion and health tips.

    “Imagine being able to buy 1,000 shares of AAP for $59,” says Cook. “When the stock hits $700 again, that would be worth $700,000.”

    “True,” said one stock market analyst. “And when the stock gets back to $700, we’ll be vacationing on Mars via teleportation.”

    Brushing aside the doubters, a spokesman for Cook said “Criticism of Apple is nothing new. And by the way — do you know the stock symbol for that teleportation outfit?”


  • Reply 51 of 99
    pazuzupazuzu Posts: 1,728member
    How horrible. Steve Jobs would have never… OH WAIT HE DID EXACTLY THOSE THINGS.

    REALLY? NAME IT.
    NAME A 3 YEAR PERIOD WHEN SJ RETURNED AND THERE WASNT A NEW PRODUCT LINE INTRODUCED.
  • Reply 52 of 99
    tallest skiltallest skil Posts: 43,388member
    Originally Posted by pazuzu View Post

    REALLY? NAME IT.

     

    Sure.

     

    Two splits under Steve after his return…

     

    And between 2003 and 2005 there weren’t any “new products”.

  • Reply 53 of 99
    solipsismxsolipsismx Posts: 19,566member
    pazuzu wrote: »
    REALLY? NAME IT.
    NAME A 3 YEAR PERIOD WHEN SJ RETURNED AND THERE WASNT A NEW PRODUCT LINE INTRODUCED.

    Do you ever think before you post? :no: Two seconds of research to find Apple's 2nd and 3rd split on June 21, 2000 and February 18th, 2005. (Do I need to write "respectively" for you to know which came after the other?)
    Mac in 1984 … 17 years … iPod in 2001 … 6 years … iPhone in 2007 … 3 years … iPad in 2010. The iPad took three years despite using pretty much all the parts of the iPhone and you think Apple should be able to reinvent the TV, watch, and anything else in under 3 years after each new product release. :rolleyes:
  • Reply 54 of 99
    MacProMacPro Posts: 19,697member

    LOL
  • Reply 55 of 99
    I love the fact that Ive watched my shares grow since I bought 600 shares at 7.00 each watched it split to 1200 and now 8400.. Im looking so forward to 119.25 per share! I will have made my million! :) Ive never lost faith in the fruit, and Im not only a shareholder, but a fan and tech support specialist for all of the Apple Products! Go Fruit!!! :)
  • Reply 56 of 99
    Quote:



    Originally Posted by SolipsismX View Post



    Mac in 1984 … 17 years … iPod in 2001 … 6 years … iPhone in 2007 … 3 years … iPad in 2010. The iPad took three years despite using pretty much all the parts of the iPhone and you think Apple should be able to reinvent the TV, watch, and anything else in under 3 years after each new product release. image

     

    Not to mention that (as many don't realize) the iPad was in development BEFORE the iPhone when Apple decided to change course and release the phone first, so that three year interval was pretty much a fluke and a one-off.  Most companies would be lucky to have just one of these game changing product launches in their entire history yet Apple is criticized for not having one every couple of years or so.

     

    It's funny though how when it was introduced, the pundits widely heralded the iPad as anything bug a major new product category and "just a giant iPod Touch" yet now likely the same pundits use that three year interval as "the norm" for Apple for major product releases.  By their own logic they should use at least 6 years.  Where are all those "giant iPod" people now?

  • Reply 57 of 99
    carthusiacarthusia Posts: 583member
    Quote:

    Originally Posted by SolipsismX View Post





    Not a silly question. Cheapest and easiest way I know is to you an online broker.
    Some of them will also have deals for free trades, discounted rates, and other options based on the amount you open your account with.

    Thanks for the link!

  • Reply 58 of 99
    jeffdmjeffdm Posts: 12,951member
    Stock splits don't change real value though, for one seventh the price as before, you get one seventh the company as before. The only reason it makes any difference is when you're dealing with non-rational influences.
  • Reply 59 of 99
    bravadubravadu Posts: 37member
    Quote:
    Originally Posted by quinney View Post

    Correct. Everybody had the same number of votes after the split that they had before, contrary to DED's idea that Google somehow took votes away from people.

     

    Brin and Page (mostly those two) have Class B shares that are nominally the same value as everybody else's Class A shares but have 10 times the voting power.  Issuing regular stock and selling Class B shares (to live life lavishly) over the last decade and more has diluted their control down to just over 55 percent.

     

    Now how can you have your cake and eat it?  That is to raise money without losing control of your company...

     

    That's simple - split all shares into half, with one half retaining the voting power, then sell all your non-voting shares for big bucks.  Repeat as many times as you want to raise more cash.  They have over 55% of the shareholder votes anyway so it will always pass.

     

    Right now, Brin and Page are pretty talented, but 50 years from now, who knows what direction Google will be headed with trust-fund baby heirs at the helm.

  • Reply 60 of 99
    froodfrood Posts: 771member
    Quote:

    Originally Posted by Apple ][ View Post

     

    Maybe he's referring to how Google issued a different class of shares. I don't really follow GOOG all that much, but I remember reading something about that. In addition to GOOG, there's also something called GOOGL I noticed.


     

    Google wanted to be able to issue more shares for employee incentives.  As they do that, the owners would have to issue themselves an equal percentage of shares in order to maintain the same ownership.  They did not want to do that.  In their corporate charter they stated something to the effect that they don't want to be beholden to Wall Street or be forced to make decisions quarter to quarter.

     

    Larry and Sergey have over 50% of the voting shares at Google between them- so if they agree on anything it is a given.  Schmidt has just enough so that if Larry and Sergey disagree he gets to be the swing vote.

     

    They did not want to disrupt that structure as it is what allows Google to be Google.  If they were beholden to Wall Street, Greenlight and Icahn would be diving in and screaming that they need to get rid of cars, robots, and who knows what else.

     

    To acheive that they created a new class of shares that has no voting rights.  The stock split itself changed nothing as far as ownership percentages or voting strength.   It does allow Google to issue more shares to employees in the future without running the risk that Larry and Sergey lose total control of the company.

     

    Investors in Google should be well aware of that.  If you buy into Google you are basically just investing, not trying to dictate control of the company.

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