This stock purchase is exactly the advice Warren Buffet offers. He said shares of Berkshire contracted 50% at least twice and he was an aggressive buyer of shares outstanding during those times.
And whether you agree with Carl or not, I think his aggressive statements about Apple's under-valuation, plus his confidence in his position by adding an additional $.5 BN purchase after the sudden $50 drop in share price draws a lot of needed Wall Street ATTENTION and DISCUSSION back to the Apple story and its vast potentiality. (And a lot of investors were starting to take Carl's proposals more seriously when WS punished Apple's shares due to its not attaining WS's voodoo iPhone sales' expectations over and above what the Company forecasted (even though the Company did achieve the 4th highest revenue quarter in US history being surpassed only by big oil and Apple itself. That stock drop P.O'ed a lot of stakeholders including Tim C).
I too am a big Tim Cook supporter, especially since he was handpicked long ago by Steve J himself. How many people could live up to trying to follow the sentimentality and warranted tech/business fame of a "god" like Steve J, who was so famous and revered upon his untimely death, that millions of fans cried and laid wreathes in front of Apple store windows around the world? Pundits know they can still make a good living just from writing disparaging, speculative articles knocking down Apple and T.C.'s leadership by spreading fear, rumors, and unfounded doubt. (To be a famous pundit, just start with a SHOCK headline, and fill in a bogus story underneath it. If it is 100% wrong, the writer still gets her hits and pockets her bounty, as she fades into obscurity and invents a new nom de plum.)
So Apple can time their stock repurchases? I thought they were either carried out on a known schedule or they were carried out by a disinterested third party without Apple's direction.
Doesn't leaving the ability to repurchase shares when the stock is low (for whatever reason) create a conflict of interest? It would behoove the CEO or another highly placed person to undermine the stock in order to create an ideal buyback situation. Not saying that is what has happened (after all, if they were more focused on the opportunity, they should've bought back billions of their own stock when it sunk to the mid-$80 range at the beginning of the Depression/Recession...they could have essentially taken the company private at that point).
I am afraid this post makes no sense. A company can buy when it wants once the repurchase program is in place.
So the WSJ will be running more of their interview with Cook on Friday. In it Cook apparently says any reasonable person would classify what Apple is working on as new categories.
Excellent move. My only regret is that he did not exhaust the entire quota of $60B.
He still might get a chance at an even better deal.
He doesn't know that, just as you and I don't. That said, let's hope that does not come to pass.
The tenor of the interview sounds to me like he was quite surprised and p-o'ed at the negative market reaction to what he thought was a blowout quarter from Apple. I sincerely hope that this is the beginning of his getting to be a bit more savvy and proactive with Wall Street.
Excellent move. My only regret is that he did not exhaust the entire quota of $60B.
might not be as simple as that. The buyback is scheduled to run until end 2015 and given the majority of cash is held offshore they probably worked how much cash will be coming in over the 3 years which allows them a sort of schedule to buyback without going into extra debt.
So Apple can time their stock repurchases? I thought they were either carried out on a known schedule or they were carried out by a disinterested third party without Apple's direction.
Doesn't leaving the ability to repurchase shares when the stock is low (for whatever reason) create a conflict of interest? It would behoove the CEO or another highly placed person to undermine the stock in order to create an ideal buyback situation. Not saying that is what has happened (after all, if they were more focused on the opportunity, they should've bought back billions of their own stock when it sunk to the mid-$80 range at the beginning of the Depression/Recession...they could have essentially taken the company private at that point).
Whatever gave you the idea that they have to follow a schedule? They don't have to declare any such intentions at all, at any time. The only reason that Apple made known its intentions to buy back stock over time was to calm down an increasingly noisy mob that claimed that all that cash was not generating a sufficient return. Technically, they could drop $100 billion tomorrow if they wanted, presuming that sources of finance could provide them with that much cash to buy shares as a loan against the collateral of Apple's cash and equivalents held outside the U.S. Practically, it wouldn't make sense since there's not $100 billion of AAPL stock floating in the marketplace. The price would be driven up in the short run by $100 billion of instant additional demand, which would be counter to repurchasing shares at a good bargain.
"A disinterested third party without Apple's direction." Now think that one over. It's ludicrous on the face of it.
Exactly as Tim Cook said, Apple is being "opportunistic" in taking advantage of a real bargain price in recent days. Signalling your intentions is like walking down a dark back street with cash sticking out of your pockets, just begging to be mugged.
As to a CEO or others "undermining the stock" - that's called manipulation. It's illegal as hell and it's highly discoverable. Want to see your Apple leadership spend time in the Graybar Hotel? Let 'em queer the stock price.
Finally, whoever referred to Carl Icahn as a "short investor" doesn't know what he is talking about. There is no such term. There are "short sellers" and "short-term investors" (such as day traders). Icahn is neither. Icahn has skin in the game by actually putting money into a stock position, which he expects to recoup and then some when he sells his shares for a handsome gain at some reasonable point in the future. In that respect his interests are exactly aligned with most other Apple shareholders. Moreover, Icahn has supported a major Apple stock buyback as the optimal present strategy to stimulate the market price. Reducing the supply of shares outstanding increases the equilibrium point between supply and demand, other factors being equal.
He doesn't know that, just as you and I don't. That said, let's hope that does not come to pass.
The tenor of the interview sounds to me like he was quite surprised and p-o'ed at the negative market reaction to what he thought was a blowout quarter from Apple. I sincerely hope that this is the beginning of his getting to be a bit more savvy and proactive with Wall Street.
Yes, yes, yes. Personally I'd like to see Cook more pissed off and show it in comments with Wall Street analysts or the tech media. Go on offense rather than always playing defense.
So Apple can time their stock repurchases? I thought they were either carried out on a known schedule or they were carried out by a disinterested third party without Apple's direction.
I think there is a freeze period before the results are posted, but once information is public there should be no reason the CEO can't push for more aggressive buyback within the board-approved allowance. I'm not sure if they are allowed to make any transactions during the freeze, or if they can have algorithm purchases that are set prior to freeze.
I am afraid this post makes no sense. A company can buy when it wants once the repurchase program is in place.
I wonder. Considering the raft of penalties and charges levied against Apple by our government handlers in recent years, someone from the SEC may decide that the earnings call, followed by a large stock drop, followed by a massive buyback equals an opportunity to throw the book at Apple.
<span style="line-height:1.25em;">What</span>
<span style="line-height:1.25em;">ever gave you the idea that they have to follow a schedule? They don't have to declare any such intentions at all, at any time. The only reason that Apple made known its intentions to buy back stock over time was to calm down an increasingly noisy mob that claimed that all that cash was not generating a sufficient return. Technically, they could drop $100 billion tomorrow if they wanted, presuming that sources of finance could provide them with that much cash to buy shares as a loan against the collateral of </span>
<span style="line-height:1.25em;">Apple's cash and equivalents held outside the U.S. Practically, it wouldn'</span>
<span style="line-height:1.25em;">t make sense since there's not $100 billion of AAPL stock floating in the marketplace. T</span>
<span style="line-height:1.25em;">he price would be driven up in the short run by $100 billion of instant additional demand, which would be counter to repurchasing shares at a good bargain.</span>
<span style="line-height:1.25em;">"A</span> disinterested third party without Apple's direction." Now think that one over. It's ludicrous on the face of it.
Exactly as Tim Cook said, Apple is being "opportunistic" in taking advantage of a real bargain price in recent days. Signalling your intentions is like walking down a dark back street with cash sticking out of your pockets, just begging to be mugged.
As to a CEO or others "undermining the stock" - that's called manipulation. It's illegal as hell and it's highly discoverable. Want to see your Apple leadership spend time in the Graybar Hotel? Let 'em queer the stock price.
Finally, whoever referred to Carl Icahn as a "short investor" doesn't know what he is talking about. There is no such term. There are "short sellers" and "short-term investors" (such as day traders). Icahn is neither. Icahn has skin in the game by actually putting money into a stock position, which he expects to recoup and then some when he sells his shares for a handsome gain at some reasonable point in the future. In that respect his interests are exactly aligned with most other Apple shareholders. Moreover, Icahn has supported a major Apple stock buyback as the optimal present strategy to stimulate the market price. Reducing the supply of shares outstanding increases the equilibrium point between supply and demand, other factors being equal.
There is still enough wiggle room in the law to allow for charges to brought against companies the government is determined to bully or blackmail, in my opinion.
So that's about $80 million in dividends they won't be paying this quarter.
Fine by me. I'd rather have amazing growth and insane profitability than dividends. I was against the instituting of dividends at Apple and still see it as capitulation to Wall Street demands.
Honestly to needs to stop talking about new products especially when everybody knows he's not going to offer up any details. All we get now is the media mocking his statements because they're the same statements he's made umpteen times before. All he has to do is say "you're going to like what you see" and leave it at that. Don't get into any discussions on timelines or whether it's updates to existing products or new "categories". I'm not aware of any other tech company getting grilled as much about new product "categories" as Apple does. Tim needs to stop letting Wall Street and the media push him around.
Comments
That SO rocks!
This stock purchase is exactly the advice Warren Buffet offers. He said shares of Berkshire contracted 50% at least twice and he was an aggressive buyer of shares outstanding during those times.
And whether you agree with Carl or not, I think his aggressive statements about Apple's under-valuation, plus his confidence in his position by adding an additional $.5 BN purchase after the sudden $50 drop in share price draws a lot of needed Wall Street ATTENTION and DISCUSSION back to the Apple story and its vast potentiality. (And a lot of investors were starting to take Carl's proposals more seriously when WS punished Apple's shares due to its not attaining WS's voodoo iPhone sales' expectations over and above what the Company forecasted (even though the Company did achieve the 4th highest revenue quarter in US history being surpassed only by big oil and Apple itself. That stock drop P.O'ed a lot of stakeholders including Tim C).
I too am a big Tim Cook supporter, especially since he was handpicked long ago by Steve J himself. How many people could live up to trying to follow the sentimentality and warranted tech/business fame of a "god" like Steve J, who was so famous and revered upon his untimely death, that millions of fans cried and laid wreathes in front of Apple store windows around the world? Pundits know they can still make a good living just from writing disparaging, speculative articles knocking down Apple and T.C.'s leadership by spreading fear, rumors, and unfounded doubt. (To be a famous pundit, just start with a SHOCK headline, and fill in a bogus story underneath it. If it is 100% wrong, the writer still gets her hits and pockets her bounty, as she fades into obscurity and invents a new nom de plum.)
I am afraid this post makes no sense. A company can buy when it wants once the repurchase program is in place.
Keep buying back low until you can take it private. Then give Wall Street the middle finger.
Excellent move. My only regret is that he did not exhaust the entire quota of $60B.
He still might get a chance at an even better deal.
He doesn't know that, just as you and I don't. That said, let's hope that does not come to pass.
The tenor of the interview sounds to me like he was quite surprised and p-o'ed at the negative market reaction to what he thought was a blowout quarter from Apple. I sincerely hope that this is the beginning of his getting to be a bit more savvy and proactive with Wall Street.
Taking Apple private is not an option.
might not be as simple as that. The buyback is scheduled to run until end 2015 and given the majority of cash is held offshore they probably worked how much cash will be coming in over the 3 years which allows them a sort of schedule to buyback without going into extra debt.
So Apple can time their stock repurchases? I thought they were either carried out on a known schedule or they were carried out by a disinterested third party without Apple's direction.
Doesn't leaving the ability to repurchase shares when the stock is low (for whatever reason) create a conflict of interest? It would behoove the CEO or another highly placed person to undermine the stock in order to create an ideal buyback situation. Not saying that is what has happened (after all, if they were more focused on the opportunity, they should've bought back billions of their own stock when it sunk to the mid-$80 range at the beginning of the Depression/Recession...they could have essentially taken the company private at that point).
Whatever gave you the idea that they have to follow a schedule? They don't have to declare any such intentions at all, at any time. The only reason that Apple made known its intentions to buy back stock over time was to calm down an increasingly noisy mob that claimed that all that cash was not generating a sufficient return. Technically, they could drop $100 billion tomorrow if they wanted, presuming that sources of finance could provide them with that much cash to buy shares as a loan against the collateral of Apple's cash and equivalents held outside the U.S. Practically, it wouldn't make sense since there's not $100 billion of AAPL stock floating in the marketplace. The price would be driven up in the short run by $100 billion of instant additional demand, which would be counter to repurchasing shares at a good bargain.
"A disinterested third party without Apple's direction." Now think that one over. It's ludicrous on the face of it.
Exactly as Tim Cook said, Apple is being "opportunistic" in taking advantage of a real bargain price in recent days. Signalling your intentions is like walking down a dark back street with cash sticking out of your pockets, just begging to be mugged.
As to a CEO or others "undermining the stock" - that's called manipulation. It's illegal as hell and it's highly discoverable. Want to see your Apple leadership spend time in the Graybar Hotel? Let 'em queer the stock price.
Finally, whoever referred to Carl Icahn as a "short investor" doesn't know what he is talking about. There is no such term. There are "short sellers" and "short-term investors" (such as day traders). Icahn is neither. Icahn has skin in the game by actually putting money into a stock position, which he expects to recoup and then some when he sells his shares for a handsome gain at some reasonable point in the future. In that respect his interests are exactly aligned with most other Apple shareholders. Moreover, Icahn has supported a major Apple stock buyback as the optimal present strategy to stimulate the market price. Reducing the supply of shares outstanding increases the equilibrium point between supply and demand, other factors being equal.
Probably why Microsoft is resorting to this:
http://news.cnet.com/8301-17852_3-57618510-71/microsoft-sends-decaying-apple-to-apple-users/
I wonder. Considering the raft of penalties and charges levied against Apple by our government handlers in recent years, someone from the SEC may decide that the earnings call, followed by a large stock drop, followed by a massive buyback equals an opportunity to throw the book at Apple.
Here are the rules, per the SEC regarding share repurchases: https://blogs.law.harvard.edu/corpgov/2013/03/14/questions-surrounding-share-repurchases/
There is still enough wiggle room in the law to allow for charges to brought against companies the government is determined to bully or blackmail, in my opinion.
Fine by me. I'd rather have amazing growth and insane profitability than dividends. I was against the instituting of dividends at Apple and still see it as capitulation to Wall Street demands.