Apple quietly bought $17B more after record high $24B Q2 stock repurchase [u]

24

Comments

  • Reply 21 of 65
    WgkruegerWgkrueger Posts: 329member
    avon b7 said:

    "Apple is already leading the tech industry"

    I can't see how that is even remotely defendable. Apple remains primarily a CE company which is heavily dependent on other - leading - tech companies.

    I could argue that both Samsung and Huawei are leading the tech industry as both companies far outstrip where Apple swims in its particular stretch of the river.

    As for what could have been done to better invest all that cash, well there were plenty of opportunities that simply weren't put on the table.

    The reality is that Apple has invested little into R&D in terms of percentage of revenues.

    They could have easily moved into the cloud areas that Microsoft, Amazon and Google currently occupy. They could easily have invested in future communications technologies like 5G. They could have invested heavily in one of current phones weak points: battery technology. They could have moved into satellites.

    The truth is there was little foresight in the future. They played safe and hoarded instead. That isn't so much of a criticism from a business perspective, as Apple does now have a nascent penchant for buying in expensive technologies or businesses (Beats, intel 5G, content creation etc).

    The result is Netflix slipped away and now Apple (very late to the party) is playing catch-up. 5G modems? Catch-up again. iPhone (the big revenue generator)? Catch-up again. Audio streaming? Catch-up again.

    As for leading the tech industry. I disagree.
    You’re not talking about investing you’re talking about gambling. Hindsight gives you the ability to have these wonderful forward thinking ideas. Oh, and as DED has repeatedly said, that part of the river is where profits go to die. 
    tmaySoliStrangeDayslolliverdedgeckoDan_DilgerP-DogNCwatto_cobrajony0
  • Reply 22 of 65
    This article should have been written 3 months ago.  They spent $17 billion in the most recent quarter.
    dedgecko
  • Reply 23 of 65
    realisticrealistic Posts: 1,154member
    Apple is investing in AAPL?    No, it is not investing in itself.   It is doing two things:
    1). Giving away its profits to stock holders
    2)  Propping up its own stock pice

    I read a few days ago (I forget where) that in the last couple years Apple's Earnings Per Share have increased 25% -- on the SAME PROFIT.   That's all due to buybacks reducing the number of shares outstanding.

    But, Apple is not alone in its Financial Engineering.   It seems most large U.S. companies are doing it.

    So, while "we" complain about China competing unfairly against U.S. corporations, those same U.S. corporations are refusing to invest in themselves.
    Perhaps China is not the problem?
    Do you think Apple is not investing in itself? Why?

    The thing is, Apple can’t effectively spend 5x as much on R&D or plants and retail to get 5x the result. It can’t simply hire 5x as many people to get tasks done. So the options are, hold the money in tbills or distribute to shareholders—the owners of the company.

    Quite obviously, reducing shares outstanding is going to affect the earnings per share at the “same earnings.” It’s not a trick, it’s very basic math. 

    Reducing shares by buying them back and retiring them is the opposite of printing new shares. When companies issue new shares, they are diluting the value of the shares held by their investors. This is the opposite. Why the confusion?

    The complaints about China isn’t that companies are investing in their future, but that they are stealing IP, copying the design without the same concern for safety and quality, and maintaining poor working conditions that brutalize labor and expose workers to very bad conditions. That’s why apple has been forcing its suppliers to reach a much higher level of standards for worker rights, environmental protection, safety and product quality. 

    China is a huge problem. Look at what they are doing to their own air and water. 
    "Do you think Apple is not investing in itself? Why?"
    Giving away money to anybody, no matter who it is, is not investing in the company.   Period.

    "Apple can’t effectively spend 5x as much on R&D or plants and retail to get 5x the result. It can’t simply hire 5x as many people to get tasks done. So the options are, hold the money in tbills or distribute to shareholders"
    So, you are saying that Apple has nothing to invest in -- so it's better off giving the money away.   That's disturbing.   But it may, unfortunately, be true.  It is becoming increasingly common among U.S. corporations while we complain about "unfair competition".   Sad.

    "Quite obviously, reducing shares outstanding is going to affect the earnings per share at the “same earnings.” It’s not a trick, it’s very basic math"
    It's known as "Financial Engineering"

    "Reducing shares by buying them back and retiring them is the opposite of printing new shares. When companies issue new shares, they are diluting the value of the shares held by their investors. This is the opposite."
    Not quite:   When a company issues new shares, the goal is NOT to dilute the shares.   It is to raise money in order to invest in the company.  You are correct though that it is the opposite of buying back shares in order to give the money away.

    "The complaints about China isn’t that companies are investing in their future, but that they are stealing IP, copying the design without the same concern for safety and quality, and maintaining poor working conditions that brutalize labor and expose workers to very bad conditions. "
    Yeh, that's Trump's story line.   It's mostly bull.  But people buy into it.

    "China is a huge problem. Look at what they are doing to their own air and water."
    China is one of the original backers of the Paris Climate Change accords (as were we) and continues to live up to the agreement.   The U.S. is the ONLY one who pulled out so it can promote more coal fired power plants -- and generate Trump votes in West Virginia.





    You should actually read the Paris Climate change accords. I did read them China didn't really need to anything substantial about climate change for years. I agree with the US backing out since the finances for most of the accord were to borne by the USA while many countries including went along for the ride
  • Reply 24 of 65
    dysamoria said:
    They should buy it all back and delist. Getting off the gambler’s market would result in far more stability.
    Apple doesn’t have the trillion dollars that would require. As it bought up its stock, the value of the remaining shares would go up, so the actual cost of taking AAPL private would be higher than its current market cap. 
    Sorry if someone else already answered this on page 2, but it's a common misconception that a company can take itself private.  It cannot.  When a company is taken private is because some set of investors (perhaps the executives of the company) buys up all the available shares.  So, theoretically someone (or a consortium of people) with a trillion dollars (or the resources to borrow that sum, give or take a few hundred billion) could take Apple private, but Apple can't buy it's last share and own itself.
    gatorguylolliveruraharawatto_cobra
  • Reply 25 of 65
    Interesting to think that Apple could have been this generation's Berkshire Hathaway.  Instead of buying billions of dollars worth of Apple shares each quarter, they could just as easily have purchases shares in Google, Microsoft, Amazon, Facebook, Netflix, etc.  In short order they would have enough stake in those companies have seats on the board.  My understanding is that this practice is (was?) standard practice in Japan, so all the major industrial companies were closely linked.  On net, I expect it's a good thing that this isn't the practice in the US, but it's interesting to think about.
    GeorgeBMaclolliverwatto_cobrajony0
  • Reply 26 of 65
    avon b7avon b7 Posts: 5,894member
    Wgkrueger said:
    avon b7 said:

    "Apple is already leading the tech industry"

    I can't see how that is even remotely defendable. Apple remains primarily a CE company which is heavily dependent on other - leading - tech companies.

    I could argue that both Samsung and Huawei are leading the tech industry as both companies far outstrip where Apple swims in its particular stretch of the river.

    As for what could have been done to better invest all that cash, well there were plenty of opportunities that simply weren't put on the table.

    The reality is that Apple has invested little into R&D in terms of percentage of revenues.

    They could have easily moved into the cloud areas that Microsoft, Amazon and Google currently occupy. They could easily have invested in future communications technologies like 5G. They could have invested heavily in one of current phones weak points: battery technology. They could have moved into satellites.

    The truth is there was little foresight in the future. They played safe and hoarded instead. That isn't so much of a criticism from a business perspective, as Apple does now have a nascent penchant for buying in expensive technologies or businesses (Beats, intel 5G, content creation etc).

    The result is Netflix slipped away and now Apple (very late to the party) is playing catch-up. 5G modems? Catch-up again. iPhone (the big revenue generator)? Catch-up again. Audio streaming? Catch-up again.

    As for leading the tech industry. I disagree.
    You’re not talking about investing you’re talking about gambling. Hindsight gives you the ability to have these wonderful forward thinking ideas. Oh, and as DED has repeatedly said, that part of the river is where profits go to die. 
    That was my very first reading too but no, that part was on 'leading the tech industry 'while' spending 'less'. Here is a fuller snippet:

    'Apple is already leading the tech industry while spending a mere $10 billion annually on Capex and historically less than $15 billion annually on R&D'

    As you can see, we are in an investment focussed article that contains a non investment and absolute reference.

    What he is saying here is that:

    A. Apple is leading the tech industry

    B. And on top of that it is doing it without burning up reserves.

    The exact opposite could be argued. Perhaps Apple isn't leading the tech industry because it hasn't invested enough in R&D and/or hasn't seen a solid return on that outlay. However, with so much cash on hand it can also be argued R&D itself isn't the biggest issue. That would be management, who are tasked with pointing the mothership in the right direction and bringing ready-cooked R&D on-board and setting strategic goals through aquisitions.

    Even today, Apple remains largely in a CE bubble but is at least making inroads into diversification. 

    They are late onto many of those roads but the most important thing is to have direction and be moving. 

    But leading the tech industry? 




    edited August 2019
  • Reply 27 of 65
    davgregdavgreg Posts: 874member
    Stock buybacks are an inefficient means of returning value to shareholders. 
    A simple dividend would be better.

  • Reply 28 of 65
    GeorgeBMacGeorgeBMac Posts: 10,262member
    realistic said:
    Apple is investing in AAPL?    No, it is not investing in itself.   It is doing two things:
    1). Giving away its profits to stock holders
    2)  Propping up its own stock pice

    I read a few days ago (I forget where) that in the last couple years Apple's Earnings Per Share have increased 25% -- on the SAME PROFIT.   That's all due to buybacks reducing the number of shares outstanding.

    But, Apple is not alone in its Financial Engineering.   It seems most large U.S. companies are doing it.

    So, while "we" complain about China competing unfairly against U.S. corporations, those same U.S. corporations are refusing to invest in themselves.
    Perhaps China is not the problem?
    Do you think Apple is not investing in itself? Why?

    The thing is, Apple can’t effectively spend 5x as much on R&D or plants and retail to get 5x the result. It can’t simply hire 5x as many people to get tasks done. So the options are, hold the money in tbills or distribute to shareholders—the owners of the company.

    Quite obviously, reducing shares outstanding is going to affect the earnings per share at the “same earnings.” It’s not a trick, it’s very basic math. 

    Reducing shares by buying them back and retiring them is the opposite of printing new shares. When companies issue new shares, they are diluting the value of the shares held by their investors. This is the opposite. Why the confusion?

    The complaints about China isn’t that companies are investing in their future, but that they are stealing IP, copying the design without the same concern for safety and quality, and maintaining poor working conditions that brutalize labor and expose workers to very bad conditions. That’s why apple has been forcing its suppliers to reach a much higher level of standards for worker rights, environmental protection, safety and product quality. 

    China is a huge problem. Look at what they are doing to their own air and water. 
    "Do you think Apple is not investing in itself? Why?"
    Giving away money to anybody, no matter who it is, is not investing in the company.   Period.

    "Apple can’t effectively spend 5x as much on R&D or plants and retail to get 5x the result. It can’t simply hire 5x as many people to get tasks done. So the options are, hold the money in tbills or distribute to shareholders"
    So, you are saying that Apple has nothing to invest in -- so it's better off giving the money away.   That's disturbing.   But it may, unfortunately, be true.  It is becoming increasingly common among U.S. corporations while we complain about "unfair competition".   Sad.

    "Quite obviously, reducing shares outstanding is going to affect the earnings per share at the “same earnings.” It’s not a trick, it’s very basic math"
    It's known as "Financial Engineering"

    "Reducing shares by buying them back and retiring them is the opposite of printing new shares. When companies issue new shares, they are diluting the value of the shares held by their investors. This is the opposite."
    Not quite:   When a company issues new shares, the goal is NOT to dilute the shares.   It is to raise money in order to invest in the company.  You are correct though that it is the opposite of buying back shares in order to give the money away.

    "The complaints about China isn’t that companies are investing in their future, but that they are stealing IP, copying the design without the same concern for safety and quality, and maintaining poor working conditions that brutalize labor and expose workers to very bad conditions. "
    Yeh, that's Trump's story line.   It's mostly bull.  But people buy into it.

    "China is a huge problem. Look at what they are doing to their own air and water."
    China is one of the original backers of the Paris Climate Change accords (as were we) and continues to live up to the agreement.   The U.S. is the ONLY one who pulled out so it can promote more coal fired power plants -- and generate Trump votes in West Virginia.





    You should actually read the Paris Climate change accords. I did read them China didn't really need to anything substantial about climate change for years. I agree with the US backing out since the finances for most of the accord were to borne by the USA while many countries including went along for the ride
    So then you say that CHina is the problem -- even though its the U.S. who abrogated?   Interesting logic there...

    * corrected
    edited August 2019 P-DogNC
  • Reply 29 of 65
    China is a huge problem. Look at what they are doing to their own air and water. 
    China just past USA as the most polluting country in the world. yes I agree.
    but they have 4 times more population of USA so each Chinese person pollute 4 times less that an American.
    AND
    they produce so much goods for USA and other country,  that this pollution should be calculated on the buying/using country total pollution produce and not on China.  

    I have a friend who has been working in China for 12 years as an engineer. They are taking pollution and climate change very seriously and they will soon lead the world in that regard... contrary to countries who denies the existence of a problem and pushing/helping polluting coal, fuel etc. 

    The problem with China is the lack of respect for other country invention and having a government who won't let newspaper, and journalist write negative article about the government...


    GeorgeBMaclolliverFileMakerFellerDan_DilgerP-DogNCwatto_cobra
  • Reply 30 of 65
    Apart from counting how many outstanding shares are disappearing, I would never know Apple is buying back shares. I see the EPS is rising, but that hasn't stopped the P/E from falling. I certainly do get my dividends but other than that, Apple's share gains are nothing special and likely worse than any of the FANG stocks. It just seems as though Apple's overall value is either not moving or falling despite all those stock buybacks. Meanwhile, Microsoft is absolutely killing it and has left Apple well in the dust in terms of market cap. Microsoft makes being a trillion-dollar company look easy. Wall Street has no doubts at all Microsoft is a trillion-dollar company as they doubted about Apple.  Apple had such a huge advantage to stay as a trillion-dollar company but just threw it all away. China is lost for Apple with no hope of getting anything back.  India and Africa are non-starters for Apple to make any gains with.

    Apple should have taken that $24B and bought some cloud computing company to possibly offset all the lost revenue from declining iPhone sales. Cloud computing is a hot market with supposedly great growth potential. Apple doesn't seem to have diddly when it comes to growth. I realize their Services is growing, but barely fast enough to offset lost iPhone revenue. Apple should be able to do a lot better, considering all that cash they have to spend. I had been hearing about all those data centers Apple was spending money on, so whatever became of them. Are they just being used for iCloud? It sure seems like a waste of money to build dozens of data centers just for that

    I'm no financial expert but I just get tired of hearing all the talk about Apple's post-iPhone doom and gloom. Apple needs to get into a decent growth business and maybe the stock will be less volatile. I'm sure a growth business would be more effective than just buying back shares.
    edited August 2019 GeorgeBMac
  • Reply 31 of 65
    China is a huge problem. Look at what they are doing to their own air and water. 
    China just past USA as the most polluting country in the world. yes I agree.
    but they have 4 times more population of USA so each Chinese person pollute 4 times less that an American.
    AND
    they produce so much goods for USA and other country,  that this pollution should be calculated on the buying/using country total pollution produce and not on China.  

    I have a friend who has been working in China for 12 years as an engineer. They are taking pollution and climate change very seriously and they will soon lead the world in that regard... contrary to countries who denies the existence of a problem and pushing/helping polluting coal, fuel etc. 

    The problem with China is the lack of respect for other country invention and having a government who won't let newspaper, and journalist write negative article about the government...


    Not sure where you get your numbers but the US is #88 on the 2019 pollution index.  It is based on per capita.  China was #13.  
    Dan_Dilgerwatto_cobra
  • Reply 32 of 65
    GeorgeBMacGeorgeBMac Posts: 10,262member
    China is a huge problem. Look at what they are doing to their own air and water. 
    China just past USA as the most polluting country in the world. yes I agree.
    but they have 4 times more population of USA so each Chinese person pollute 4 times less that an American.
    AND
    they produce so much goods for USA and other country,  that this pollution should be calculated on the buying/using country total pollution produce and not on China.  

    I have a friend who has been working in China for 12 years as an engineer. They are taking pollution and climate change very seriously and they will soon lead the world in that regard... contrary to countries who denies the existence of a problem and pushing/helping polluting coal, fuel etc. 

    The problem with China is the lack of respect for other country invention and having a government who won't let newspaper, and journalist write negative article about the government...


    Not sure where you get your numbers but the US is #88 on the 2019 pollution index.  It is based on per capita.  China was #13.  
    He was talking the country as a whole and acknowledged it was different on a per capita basis.
    P-DogNC
  • Reply 33 of 65
    China is a huge problem. Look at what they are doing to their own air and water. 
    China just past USA as the most polluting country in the world. yes I agree.
    but they have 4 times more population of USA so each Chinese person pollute 4 times less that an American.
    AND
    they produce so much goods for USA and other country,  that this pollution should be calculated on the buying/using country total pollution produce and not on China.  

    I have a friend who has been working in China for 12 years as an engineer. They are taking pollution and climate change very seriously and they will soon lead the world in that regard... contrary to countries who denies the existence of a problem and pushing/helping polluting coal, fuel etc. 

    The problem with China is the lack of respect for other country invention and having a government who won't let newspaper, and journalist write negative article about the government...


    Not sure where you get your numbers but the US is #88 on the 2019 pollution index.  It is based on per capita.  China was #13.  
    He was talking the country as a whole and acknowledged it was different on a per capita basis.
    He said that China just passed the USA and that is not accurate...........at all.

    If you believe the 12 year nonsense then you have to be willing to use an EMP on China and India.  Otherwise the world is ending.
    watto_cobra
  • Reply 34 of 65
    GeorgeBMacGeorgeBMac Posts: 10,262member
    China is a huge problem. Look at what they are doing to their own air and water. 
    China just past USA as the most polluting country in the world. yes I agree.
    but they have 4 times more population of USA so each Chinese person pollute 4 times less that an American.
    AND
    they produce so much goods for USA and other country,  that this pollution should be calculated on the buying/using country total pollution produce and not on China.  

    I have a friend who has been working in China for 12 years as an engineer. They are taking pollution and climate change very seriously and they will soon lead the world in that regard... contrary to countries who denies the existence of a problem and pushing/helping polluting coal, fuel etc. 

    The problem with China is the lack of respect for other country invention and having a government who won't let newspaper, and journalist write negative article about the government...


    Not sure where you get your numbers but the US is #88 on the 2019 pollution index.  It is based on per capita.  China was #13.  
    He was talking the country as a whole and acknowledged it was different on a per capita basis.
    He said that China just passed the USA and that is not accurate...........at all.

    If you believe the 12 year nonsense then you have to be willing to use an EMP on China and India.  Otherwise the world is ending.
    Actually, it's a mute point:   Both countries signed the Paris Accords.  China is living by their commitment.   The U.S. welched.
    P-DogNCphilboogie
  • Reply 35 of 65
    crowleycrowley Posts: 8,712member
    dysamoria said:
    They should buy it all back and delist. Getting off the gambler’s market would result in far more stability.
    Apple doesn’t have the trillion dollars that would require. As it bought up its stock, the value of the remaining shares would go up, so the actual cost of taking AAPL private would be higher than its current market cap. 
    Companies do not go private by buying back shares, that's simply not how it works.
  • Reply 36 of 65
    crowleycrowley Posts: 8,712member

     Buying back stock and then keeping that stock makes perfect sense to me.  You profit as a company from any further share-price increases, plus you control a larger percentage of outstanding shares..

    But buying back stock and then retiring that stock is what I don't understand.. If you retire the shares then isn't that like just destroying money, right? Who gains from that?  Plus, with less outstanding shares, you have less percentage left, so less control, not more..

    Can somebody explain like I'm five?  thx 
    Outstanding shares x the share price is the perceived value of the company. If you reduce shares outstanding, the price rationally goes up even if the market perceived valuation does not. 

    ....
    But if it does anything to the actual value of the company, it is to, in the long term, degrade it by squandering precious resources.
    Apple was very recently the most cash-rich publically listed company on the planet.  They have enough cash to return some to shareholders while fulfilling all of their investment goals.  They are certainly not, as you imply, cash-limited.
    lollivertmay
  • Reply 37 of 65
    bohlerbohler Posts: 35member
    what a stupid waste of money instead of doing something big and changing the world. This lack of courage and ideas is sickening ! buying tesla and investing billions into the car industry would be a real game changer..nobody would be able to compete with an Apple-Tesla juggernaut- instead we get buybacks, boring iphones, unimpressive laptops, and the same old sucking butterfly keyboard
  • Reply 38 of 65
    fastasleepfastasleep Posts: 5,682member
    bohler said:
    what a stupid waste of money instead of doing something big and changing the world. This lack of courage and ideas is sickening ! buying tesla and investing billions into the car industry would be a real game changer..nobody would be able to compete with an Apple-Tesla juggernaut- instead we get buybacks, boring iphones, unimpressive laptops, and the same old sucking butterfly keyboard
    Not a glass half full type, are ya?
    lolliverFileMakerFellerRayz2016P-DogNCwatto_cobra
  • Reply 39 of 65
    SpamSandwichSpamSandwich Posts: 33,408member
    The time to be repurchasing Apple stock is now, when it is irrationally undervalued due to a shaky market.
    lolliverFileMakerFellertmayGG1P-DogNCwatto_cobra
  • Reply 40 of 65
    StrangeDaysStrangeDays Posts: 11,558member
    Apple is investing in AAPL?    No, it is not investing in itself.   It is doing two things:
    1). Giving away its profits to stock holders
    2)  Propping up its own stock pice

    I read a few days ago (I forget where) that in the last couple years Apple's Earnings Per Share have increased 25% -- on the SAME PROFIT.   That's all due to buybacks reducing the number of shares outstanding.

    But, Apple is not alone in its Financial Engineering.   It seems most large U.S. companies are doing it.

    So, while "we" complain about China competing unfairly against U.S. corporations, those same U.S. corporations are refusing to invest in themselves.
    Perhaps China is not the problem?
    Where’s the roll of tinfoil, fellas? We need moar!

    Apple’s P/E ratio is still such that it’s clear they are undervalued. Your conspiracy theories that Apple is engaged in financial engineering is delusional nonsense. Seems part of your pro-China agenda. 
    lollivertmayGG1watto_cobra
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