carnegie

zoetmb said:

randominternetperson said:

Sounds like a legal shot in the dark to me.  Good luck convincing a judge that my playing a song from Apple Music is a "public performance."

That's not really the issue.  There's performance rights (the recording) and there's publishing rights (publisher/writers).   Publishing rights used to be cleared only through ASCAP, BMI and SESAC, but in recent years there's been a crop of new PRO's that have cropped up and this seems to be one of them.   

The rights to use the recording for streams is cleared through Sound Exchange (although Apple might have an option of making a deal directly with the record label).  As long as Apple is using Sound Exchange, they should be in the clear on that regard.   The Publishing rights is another matter:   if these songs are not part of the ASCAP, BMI or SESAC catalogs, Apple could have an unpaid obligation and even though this company sounds scuzzy, Apple cannot just skip out on paying publishing rights.   

But this company does seem to be exaggerating value.  Their lawsuit against Spotify is asking for close to $2 per stream.   If only.   Streams pay fractions of a penny, not dollars.  On the Billboard charts, they count 1250 paid subscription streams or 3750 ad supported streams as 1 album equivalent  which means a single song is the equivalent of about 104 paid subscription streams or 312 ad supported streams (assuming 12 tracks per album).   If you assume that the retail value of a single is worth $3 and a typical publishing royalty is about 6%, each paid stream is worth about $0.001728 and each ad supported stream is worth about $0.000576 to a publisher.    If half of the 550 million streams are paid and half are ad supported, that means Spotify would owe them $600K, which is a long way from $1 billion and that's if there were really 550 million streams.    

gatorguy said:

carnegie said:

gatorguy said:

carnegie said:

melgross said:

carnegie said:

gatorguy said:

carnegie said:

Apple repurchased 85.7 million shares in the open market during the quarter, at a cost of $17.9 billion and an average price of $208.79. That doesn't include 6.9 million shares which were delivered to Apple during the quarter to complete a $12 billion ASR agreement that Apple entered into in February. Apple's outstanding share count dropped by 88.2 million during the quarter.

Over the last 7 years Apple has repurchased 2.420 billion shares at a cost of $306.1 billon and an average price of $126.51.

The new outstanding share count, as of October 18th, is 4,443,265,000. That number actually went up a small amount from the end of the quarter, which suggests that Apple wasn't very active buying back shares during those 3 weeks.

How much of a difference has it made in the share price? Totally honest question. 

Could distributing the excess cash in a series of special dividends been a more effective use of the money as well as being more measurable? If the cash had been distributed per outstanding share how much would each share receive? Back of the envelope says around $40 each on top of the regular dividends. Bonus: The share price might still go up as a result, right?

We may have discussed this before, but...

We're talking about a counterfactual, so we of course can't prove that the stock price would be lower today if Apple hadn't repurchased the shares that it repurchased over the last 7 years. I can't prove that there'd be no human life on earth today if the sun had gone supernova a year ago. But I can, based on what I know, conclude with a high degree of confidence that that would be the case.

If we want to consider what the share price of AAPL would be today if, other things being equal, it hadn't repurchased the 2.4 billion shares it did over the last 7 years, we can consider how the differences (between the current reality and that counterfactual) might effect the market's valuation of Apple. Apple would have 2.4 billion less outstanding shares and around $300 billion more in net cash on its books. If Apple had the same share price as it does now (I'll use $247.89, which is what it was a moment ago when I checked), but had 2.42 billion more shares outstanding, its market cap would be about $1.7 trillion - about $600 billion higher than it is now. So, the question we might ask is: Would the market value Apple $600 billion more if, other things being equal, Apple had $300 billion more in net cash on its books? I don't think so. I think, at best, the market would value that extra net cash at 1:1 - giving Apple a market cap of around $1.4 trillion. That would mean a share price of around $204 - $44 lower than it is now.

In simplest terms, what share repurchases tend to do is concentrate (or, put an other way, increase) future share price moves. Future increases become greater or future decreases become greater. (The mechanics of why are pretty straight forward, but I can go through them if needed.)

That's a comparison to what might be the case if Apple hadn't bought back shares, but instead continued to retain all those earnings. I don't think it can credibly be argued that the share repurchases haven't helped Apple's stock price. As for comparing the repurchases to something else Apple might have done with that money, that would of course depend on what that something else was. You ask about special dividends. I don't think that would have been as good an option because (1) it forces tax consequences on shareholders rather than leaving them free to decide whether or not to take those tax consequences at a given time and (2) because it wouldn't reward (and thus encourage) long-term ownership of Apple stock. A special dividend would result in an increase in the share price up until the special dividend date, and then the increase would disappear. There'd be no reason to value shares higher going forward based on a special dividend having been paid.

As it is, Apple has effectively been buying Apple on behalf of continuing shareholders - it is, at no cost to them, giving them more of the company and a larger share of its total value going forward. It has thus far been doing that at very attractive prices. If shareholders instead want cash now, they have the option of selling shares and getting that cash. They can sell a portion of their holdings which is equivalent to the concentration they realized from Apple buying back shares and thus end up owning the same portion of Apple which they owned before and receiving the same amount of cash as they would have gotten as a dividend payment if Apple had instead used the money to pay special dividends. Those who choose not to do that get to benefit from share price increases which might happen after the buybacks. In other words, people who think Apple should be paying dividends instead of buying back shares (or people who, for their own reasons, would just prefer that), can sell shares and end up with meaningfully the same result. Those who don't think that can continue to hold their concentrated shares.

Another way to think about it is like this: If for some reason Apple needed that $300 billion which the share buybacks have effectively cost it, it could raise that much and more by issuing new shares and selling them. Even at an average price $50 below where the stock trades today, Apple would be way ahead - it would raise far more money than it spent buying back shares, even while keeping share concentration the same (or greater) than it would have been had Apple not repurchased shares to begin with. Apple is, in effect, way ahead on its share repurchases. Apple, of course, isn't going to do that. That's the point, the money spent on buybacks is money that Apple didn't need - that it wasn't going to use for other purposes. It already spends, on other things, all the money that it thinks makes good business sense. The only real choice is special (or much larger) dividends or share buybacks, and for a number of reasons I think the latter is a much better option.

I disagree, I don’t believe your argument to be credible. It’s no more than conjecture. I have no doubt that shares pop right after a repurchase program is announced. But all evidence shows it to be small, and short lived. I doubt anyone here would agree that if Apple purchased 20% of their shares at once, that the stock would suddenly move to $300. And stay there. It would move a bit, maybe $10, but market forces would wipe it out.

there is simply no way to prove, or even statistically show, that share repurchases move directly in line with stock prices. It’s never been proven. And like so many financial theories lack of evidence doesn’t seem to matter for those who believe in them, unfortunately.

Of course it can't be proven, it's a counterfactual.

But I'd ask... By how much more do you think the market would value Apple today if Apple, with other things being the same, had an additional $300 billion in net cash on its books? That's the most straightforward way to get a fair idea of the overall effect of Apple having repurchased shares rather than it having just continued to hold that money.

You keep saying "hold on to the cash". Which one of us is saying that, and at the same time implying that's the only other option? Only you. 

I didn't imply that was the only option. To the contrary, I actually referred - in my first response to you - to there being other possibilities which the share buybacks might be compared to...
If you'd like to compare to other possibilities for how the cash might have been used, then we can perhaps do that....

You identified one other possibility - special dividends - and I addressed that. I don't think special dividends would have helped Apple's share price going forward as much as the buybacks did. Mechanistically they'd work quite differently. They wouldn't tend to inflate per-share price by concentration and they wouldn't tend to inflate per-share price, going forward, by increasing the valuation of Apple as a whole - at least not to the degree that concentration from buybacks has. Put another way, they wouldn't have been taking advantage of Apple's shares having been priced so low. That's the beauty of the buybacks which Apple did. Apple was buying something - equity in itself - which was, at the time, very undervalued. 

Apple bought zero equity in itself. There's no retained book value so there's no equity. That's basic accounting.

EDIT: This is an interesting and very recent article that's perfectly aligned to our discussion on the merits of stock buybacks IMHO
https://www.theatlantic.com/magazine/archive/2019/08/the-stock-buyback-swindle/592774/

sflocal said:

iOS_Guy80 said:

netrox said:

I hope he wins the appeal. It seems ridiculous since he wasn't playing.

Exactly what constitutes a uniform violation? Would he be in violation if he were wearing a Rolex? Fitbit?

"The player is reportedly appealing against the fine, which concerns the wearing of any electronic messaging devices during play."

Right there, clear as day.  A Rolex and Fitbit do not have the ability to send electronic messages.

I too think it's ridiculous especially since he wasn't playing at the time.  Would he be fined if he took out his smartphone and started texting on the sidelines as well since he's not playing?

DAalseth said:

rotateleftbyte said:

Perhaps the Apple legal depertment should step up and make sure that their colleagues in Marketing don't drop them in it like this.

If this other company does own the trademark then this is just sloppy by apple. All they need was a disclaimer in 2pt type saying that they don't own the trademark rights in the USA.

IANAL etc.

Exactly right. If this company has a shipping product that uses this name Apple should have not used it. It looks like nobody checked. A screw up on Apple’s part. One that they will have to pay for. 

Something just occurred to me. Do you think whoever it was that used it on stage thought of it on the spot and dropped it in the presentation? He seemed awfully pleased with himself. 

AppleInsider said:

...

Referring to its US Patent No 10,133,558, dated November 2018 and known as the '558 Patent, Aftechmobile says Apple is infringing "at least one of the 28 claims" in that patent, by making and selling the Shortcuts app.

...