Apple Preparing to Offer 'Significant' Dividend for Investors Early Next Year?

[GfPQqmcRKUvP]

Is that something you were taught in some biz 101 class?

Is this necessary? It's one thing to be wrong. It's quite another to be annoying in your lack of knowledge.

Future cash flow can be reflected much more appropriately through appreciation than dividends.

I addressed this exact point in my previous post. Please re-read it. (Hint: appreciation is not cash flow)

Take a look at Berkshire, a non-dividend payer, trading at @85K per share last time I checked.

The fact that Berkshire trades at a higher share price means nothing. Apple is a more valuable company despite its much lower share price.

 

[mccldwll]

As an degreed economist who has had to use lawyers (who are all evil) and financiers (who are all transaction focused) and politicians (who are always acting counter to constituent interest) it seems to me only economists are aware of and care about, not only the individual, but the firm, the society, and the world. They simply cannot agree on methods sufficient to get the attention of any of those other groups, who happen to be in charge of the centers of power in this world.

Rocketman

LOL. That is funny.

Berta's Fundamental Law of Economic Rents.. "The only thing more dangerous than an amateur economist is a professional economist."

----------

Is this necessary? It's one thing to be wrong. It's quite another to be annoying in your lack of knowledge.

I addressed this exact point in my previous post. Please re-read it. (Hint: appreciation is not cash flow)


The fact that Berkshire trades at a higher share price means nothing. Apple is a more valuable company despite its much lower share price.

Yes, you are annoying in your lack of knowledge. Stock price in general reflects an expectation of future cash flow to the entity. There is no necessity that it flows to the shareholders. Have someone explain it to you. As far as Berkshire, you're missing the point, again. The earlier poster ridiculously stated that no long term investor is interested in a stock that doesn't pay dividends. BRK.A doesn't pay dividends. That hasn't stopped long term investors from owning it.

 

[GfPQqmcRKUvP]

Yes, you are annoying in your lack of knowledge.

I don't know what my firm is thinking paying me to do what I do then.

Stock price in general reflects an expectation of future cash flow to the entity.

This is unequivocally wrong. The stock price reflects the future, discounted cash flows that are attributable to the equity holder in excess of the business' operating requirements. You are arguing that a share has intrinsic worth purely from a share appreciation perspective without any expectation of eventual return to shareholders via sale, dividend, or liquidation.

There is no necessity that it flows to the shareholders.

See above.

As far as Berkshire, you're missing the point, again. The earlier poster ridiculously stated that no long term investor is interested in a stock that doesn't pay dividends. BRK.A doesn't pay dividends. That hasn't stopped long term investors from owning it.

I'm not interested in what the earlier poster said. I'm responding to comments you've made that are wrong irrespective of others. By the way, I'm not saying BRK.A needs to pay dividends, I'm saying I think it's hilarious you think the dollar value of a share of BRK.A means anything.

I'm completely in favor of a good dialogue and hopefully persuading someone to look at an issue more in-depth than before. All I ask is that people don't act like they're authorities on a subject they don't have a good grasp of. I know you're sitting there so sure of your own knowledge and dismissive of others, but I hope for your own sake that you learn more about finance. It's knowledge that is rewarding and practical.

 

[Navdakilla]

Very nice of apple

 

[the8thark]

That sound you just heard was LTD's heart hitting the floor

LTD has some of the best posts on this forum. And you just say this about him. Shame on you. Anyone with an ounce of caring in their body would be ashamed with themselves if they said something like you did.

I on the other hand read the LTD words and an enlightened by them.

 

[FluJunkie]

Yes, you are annoying in your lack of knowledge. Stock price in general reflects an expectation of future cash flow to the entity. There is no necessity that it flows to the shareholders. Have someone explain it to you. As far as Berkshire, you're missing the point, again. The earlier poster ridiculously stated that no long term investor is interested in a stock that doesn't pay dividends. BRK.A doesn't pay dividends. That hasn't stopped long term investors from owning it.

Speaking of lack of knowledge...

Berkshire Hathaway - and Buffet generally - are heavily invested in dividend distributing stocks. There are tax consequences to dividends, so Berkshire mostly returns shareholder value from stock buybacks.

See: http://www.forbes.com/sites/schifrin/2011/11/23/berkshire-hathaways-dividend-obsession/

Pick a different example. Any other example. Buy building an anti-dividend argument on Warren Buffet is like basing your beige computer's design on things Steve Jobs wrote.

 

[Abazigal]

That wasn't opinion, it was fact. Owning a stock is worthless without the promise of future cash flows from the business. That most people profit off selling the stock to another individual is merely an intermediate step before distribution of the business's accumulated wealth via dividends and/or eventual liquidation.

You are absolutely right, now that I have had some time to sit back and think over what you just said.

It appears that Apple comes nowhere close to using its massive war-chest, nor does it have plans to invest it (nor do I feel it should, as this is not its area of expertise). In this case, after some reflecting, I believe it only makes sense to redistribute some of this surplus back to the shareholders, rather than have it collect dust.

It could probably afford to disburse up to 40 billion in cash and still have a healthy surplus for future development.

I guess I do learn something new every day.

 

[donnaw]

What a ridiculous collection of opinion. I'm not sure you understand investing if you think the goal is to make back your investment through dividends and that "long-term investors do not invest without dividends". I guess if Berkshire Hathaway ever decides to pay a dividend investors might want to own it and it might increase in value beyond it's measly sub $100,000 per share value.

I never said the goal is to make back an investment via dividends. Dividends are an on-going form of income. The vast majority of stocks are owned by large pension funds and hedge funds. Pension funds in particular are not only interested in return (dividends) but have a responsibility to generate them. They must generate income to pay their retirees. The same holds true for individual retirees - many of whom count on their dividend income to live.

I understand investing very well having been a very successful investor for almost 40 years. Any long-term investment strategy has dividend generation as a large part of it. If you are in just for growth, fine, but as I said earlier, look at all the people who lost everything in the dotcom bust.

When I own a stock I own a piece of that company. I fully expect that company to consider my interests. I own a lot of stocks, some pay dividends, some I'm in for growth. But when a company such as Apple has a huge amount of cash on hand but refuses to return some of it to its owners I dump it and move on. It's likely that many other long-term investors will do likewise. And every company needs long-term investors to ensure their stock's stability.

 

[mccldwll]

I don't know what my firm is thinking paying me to do what I do then.

You are arguing that a share has intrinsic worth purely from a share appreciation perspective without any expectation of eventual return to shareholders via sale, dividend, or liquidation.

I'm not interested in what the earlier poster said. I'm responding to comments you've made that are wrong irrespective of others. By the way, I'm not saying BRK.A needs to pay dividends, I'm saying I think it's hilarious you think the dollar value of a share of BRK.A means anything.

I have no idea why your firm pays you to do whatever you do.
I am not in any way arguing that a share has intrinsic worth purely from an appreciation perspective. Not even close. That's tulip bulbs. I said that price is determined by anticipated future entity earnings. Investors expect to be rewarded with price appreciation and sale, not liquidation of the entity, or dividends (especially in tech stocks--no one buys IBM for its 1.6 yield). Someone said that sale of stock was simply some "intermediary step" to get value from a concern, with the main source being dividends or liquidation. That's some kind if academic statement which has nothing to do with how the market/investors operate and their expectations.
This started because the poster said that he had sold his aapl and that no longterm investor would want to own a stock which didn't pay dividends, which is ridiculous. BRK.A was used as an example of a stock which investors want to own whether it pays a dividend ir not. I think it's hilarious that you apparently think the dollar value of a share of BRK.A means nothing. The present price reflects the value of years of undistributed earnings, assets, ongoing earnings, and buybacks. The price of a share of BRK.A means everything.

 

[mccldwll]

Speaking of lack of knowledge...

Berkshire Hathaway - and Buffet generally - are heavily invested in dividend distributing stocks. There are tax consequences to dividends, so Berkshire mostly returns shareholder value from stock buybacks.

See: http://www.forbes.com/sites/schifrin/2011/11/23/berkshire-hathaways-dividend-obsession/

Pick a different example. Any other example. Buy building an anti-dividend argument on Warren Buffet is like basing your beige computer's design on things Steve Jobs wrote.

Shareholder value isn't returned through buybacks, unless a shareholder sells. That's the point. Anyone who wants cash out any stock in excess of a small or zero dividend can simply sell some shares. Create your own dividend. In the old days when trading costs for odd lot sales were expensive, that wasn't a reasonable alternative. Today with trades @$10, that's nit an impediment.
BTW, I am not anti-dividend. In fact, I'd love a dividend if aapl decides that all reasonably forseeable contingent needs can be met and still pay one. I am not making an anti-dividend argument. I'm simply refuting a claim that no longterm investor would want to own a stock which didn't pay dividends. I'm also anti poorly informed backseat drivers who have absolutely no idea what aapl's strategic vision, wants, and needs might be, but think they could better drive the bus.

 

[mccldwll]

I never said the goal is to make back an investment via dividends. Dividends are an on-going form of income. The vast majority of stocks are owned by large pension funds and hedge funds. Pension funds in particular are not only interested in return (dividends) but have a responsibility to generate them. They must generate income to pay their retirees. The same holds true for individual retirees - many of whom count on their dividend income to live.

I understand investing very well having been a very successful investor for almost 40 years. Any long-term investment strategy has dividend generation as a large part of it. If you are in just for growth, fine, but as I said earlier, look at all the people who lost everything in the dotcom bust.

When I own a stock I own a piece of that company. I fully expect that company to consider my interests. I own a lot of stocks, some pay dividends, some I'm in for growth. But when a company such as Apple has a huge amount of cash on hand but refuses to return some of it to its owners I dump it and move on. It's likely that many other long-term investors will do likewise. And every company needs long-term investors to ensure their stock's stability.

Actually, you did. Specifically, you wrote:

"I'm not sure you understand investing. The purpose of owning stocks has always been to participate in the profits of a company. If you own stock you own a piece of the company. Dividends are a way of returning part of a stock holders investment to them.
So yes, if you are a shareholder you can and hopefully will eventually make back your initial investment plus profits via dividends. That's the point."


You then went on to state that without dividends, long-term shareholders would sell since "long-term investors do not invest without dividends". Specifically, you stated:

"Companies need long term investors in order to guarentee stability in their stock prices. Day traders live and die by volatility. Companies need stability and long-term investors do not invest without dividends."

That is flat out wrong.
However, what is true is that a certain funds are required to own dividend paying stocks, and some push the notion that aapl paying any dividend (say 1%) would open it to more potential investors. It might, or it might not.

 

[mccldwll]

Speaking of lack of knowledge...

Berkshire Hathaway - and Buffet generally - are heavily invested in dividend distributing stocks. There are tax consequences to dividends, so Berkshire mostly returns shareholder value from stock buybacks.

See: http://www.forbes.com/sites/schifrin/2011/11/23/berkshire-hathaways-dividend-obsession/

Pick a different example. Any other example. Buy building an anti-dividend argument on Warren Buffet is like basing your beige computer's design on things Steve Jobs wrote.

Actually, BRK.A is a oerfect example. Read the link within your link:

http://www.forbes.com/sites/baldwin/2011/11/03/berkshires-clever-tax-free-dividend/

It's nothing special but does argue that buybacks are much better than dividend payouts due to tax consequences (after 2012, which probably won't come into effect). And, excess cash aside, there is little/no difference at the time of the buyback between a buyback and simply retaining the cash. The benefit of a buyback, according to Buffett and the article, is to buy back when share price drops below its true value. Authorized buybacks thus help to support a stock price.

 

[TallManNY]

You then went on to state that without dividends, long-term shareholders would sell since "long-term investors do not invest without dividends".

Mccldwell,

This is the point that people are trying to make. Eventually a stock owner wants to get more than a pretty stock certificate, they want to get cash out of their investment. Yes, they can sell the stock, but only to another person who also only wants to get cash (and not the pure pleasure of owning a share). The only exception to this that I know is the Green Bay Packers, which people do own just for the fun of it and civic mindedness.

So for a stock to have value there must be an expectation that eventually it will return cash to the owner of that stock. Even companies which have never paid dividends are expected to eventually (or at least have the ability to) (i) pay a dividend, (ii) do a share buyback, (iii) liquidate, or (iv) be acquired by another company for that company's shares (which would eventually do one of clauses (i), (ii) or (iii)).

So Berkshire may not have paid a dividend, but since it can, its owners can sell to someone else who can wait for the dividend, buyback or liquidation.

One of my concerns as an Apple Shareholder is that they are going to squander this cash. Obviously I'm not concerned enough to sell, but I'm still concerned. I think the market is concerned because the stock is certainly not trading at the level you would expect if you think Apple is going to have another 25% in earnings growth in 2012. I also recognize that I'm not in a good position to second guess the heads of Apple and their board. Their track record is pretty darn good. So I'm rolling with them and continuing to hold on to my shares.

Incidentally, I knew that Jobs would never allow a dividend. The release of cash from the company would have been release of control and he would never go for that. I became a stock owner knowing that and was ready to roll with him as the CEO as long as he was able. I was deeply saddened by his death. But it has been clear for quite some time that Apple has no use for this stockpile. I believe their decision not to pay a dividend was to appease Jobs. I expect 2012 to be another record year. I do not expect that paying out a $10 billion dividend, for example, would leave Apple with a smaller capital account at the end of 2012 than they have now at the end of 2011. Apple could easily be pulling in $2 billion a month when you consider how ramped up their iPhone production is and that they apparently still sell every single one as fast as they can make them and at a huge margin.

I'm very bullish on Apple in both the short and the long term. So for me, it seems that any dividend will be easily replaced.

 

[TallManNY]

Another reason that I want a dividend now is that tax rates on dividends are at historic lows of 15%. Very soon they might rise. Now is a good time to get some of that money out of Apple. Next year or 2013 the rates might go up.

Apple could (and probably should) do a share buyback as well. That is another method to get cash in the hands of shareholders.

But maybe some of you would like to see Apple spend $70 billion and buy Facebook.

 

[GfPQqmcRKUvP]

You are absolutely right, now that I have had some time to sit back and think over what you just said.

It appears that Apple comes nowhere close to using its massive war-chest, nor does it have plans to invest it (nor do I feel it should, as this is not its area of expertise). In this case, after some reflecting, I believe it only makes sense to redistribute some of this surplus back to the shareholders, rather than have it collect dust.

It could probably afford to disburse up to 40 billion in cash and still have a healthy surplus for future development.

I guess I do learn something new every day.

Great! The opinions in this thread are interesting. My opinion is that Apple has a lot of money I expect them never to touch (especially considering how much they're generating), so moving the eventual distribution that is implicit in every stock price to the present makes perfect sense.

I said that price is determined by anticipated future entity earnings.

No, it isn't, and I don't know how many times I have to repeat this. The price is determined by future cash flow to the stockholder, which is a subset of entity earnings. The distinction is important because there has to be an expectation of return of invested capital at some point down the line.

This started because the poster said that he had sold his aapl and that no longterm investor would want to own a stock which didn't pay dividends, which is ridiculous. BRK.A was used as an example of a stock which investors want to own whether it pays a dividend ir not. I think it's hilarious that you apparently think the dollar value of a share of BRK.A means nothing.

The share price is measured in thousands, so what? It just means they have fewer shares than they would have if they had done frequent stock splits. Again, BRK owns dividend paying companies and those dividends flow through and operate under the same assumption of return of capital at some point in the future (discounted back to present from that point in the future). Long-term investors hold BRK because they expect that the money is being used efficiently and/or they expect a return at some point. If you think Apple can efficiently use $80 billion in cash (plus the excess $10 billion it's generating every year), then Apple shouldn't pay a dividend and this conversation is moot. If you, like me, think that Apple has enough money and cash-generating capacity to do everything it wants with just a bit less than $80 billion in the bank, a dividend is logical.

So for a stock to have value there must be an expectation that eventually it will return cash to the owner of that stock. Even companies which have never paid dividends are expected to eventually (or at least have the ability to) (i) pay a dividend, (ii) do a share buyback, (iii) liquidate, or (iv) be acquired by another company for that company's shares (which would eventually do one of clauses (i), (ii) or (iii)).

So Berkshire may not have paid a dividend, but since it can, its owners can sell to someone else who can wait for the dividend, buyback or liquidation.

Exactly.

 

[Arganos0]

Ok, some Finance 101:

In a perfect world, with no frictions and taxes, for the shareholder of an exchange listed company it would not matter whether the profits are made through capital appreciation or dividend payout. If a company does nothing the share price stays as it is. Theoretically, if a company pays a dividend, the payout makes the firm worth less and this should be accompanied by a decline in market value equal to the value of the dividend (or its present value, depending on timing issues).

Investors can achieve a homemade dividend by selling an amount of shares that equals the cash value of the dividend. They can reinvest the money in other securities if they want for a different payoff.

This together is part of what is called the Modigliani-Miller Theorem, or the Capital Structure Irrelevance Theorem. Money isn't 'returned' to shareholders since it is paired with a decline (or 'lack of increase') of the stock. As such the investor is not better or worse off if dividends are paid.

In the real world, dividends may or may not create additional shareholder value. If dividends are taxes at a lower rate than capital gains, then it might be beneficial to the shareholder to receive this money as a dividend. If capital gains taxes are lower than dividend taxes, it might be best to sell shares and create your own dividend by selling shares.

There is one other relevant idea related to dividends related to 'signaling' management expectations on the future prospects. The theory states that a company that starts to pay dividend has confidence in its future ability to keep paying these dividends and thus management expects to make profits in the years ahead. However, this is a widely debated topic as it might also mean that management is incapable of deploying the capital against a sufficiently high rate of return to be of value to shareholders. As a company grows, diminishing percentage return on capital may a factor.

 

[eNcrypTioN]

Wish I had some apple stock :-(

 

[TallManNY]

Ok, some Finance 101:

In a perfect world, with no frictions and taxes, for the shareholder of an exchange listed company it would not matter whether the profits are made through capital appreciation or dividend payout.

All good solid stuff, but as you point out the real world is far more messy.

Here is the current situation as I, and some investors, see it. I like Apple and I like my percentage (tiny fraction though it is) of the company that I own. I do not want to sell any of my stock to create my own dividend because I don't want to own less of Apple. Apple has, however, never deployed wealth in the $10s of billions of dollars to do any of their best innovations or investments. They've done low single digit billion orders, but that is as big as they've ever gone. I see Apple's management retaining control over $10's of billions of dollars (probably soon to be $100 billion if there isn't a dividend) as potential for that wealth to be misapplied. I think Apple will be more disciplined if they aren't swimming in billions. C-level compensation is already becoming larger and Apple has just done its largest takeover (a whopping $500 million).

And you have to admit that the market continues to price Apple as if its growth is going to be significantly less than it has been over the last few years. I sometimes think that the market is assuming that Apple is going to make a big mistake in the coming years and then use their large financial cushion to ride it out. I think that is a real possibility (for no reason other than gut and human nature) so I assume that a good chunk of the $80 million should be considered as already gone.

You also have to admit that an investment in an Apple share now is about $320 worth of Apple's business and then about $80 of U.S. Treasuries (which is basically where the cash is being stored). It would be nicer for folks who want to buy the Apple business if they could just do that instead of also having to buy the 2% return of Treasuries.

 

[Apple Corps]

So, today Rim shares jump 10% on "rumors" of buyout interest many months old. That equals, in one day, 50% of the percentage capital appreciation that Apple has seen in the last 12 months.

Of course Apple's financial performance will only be another blowout quarter with a pipeline that promises impressive results in the following couple of quarters as well.

 

[divinox]

No. The 80Bn belongs to the corporate entity, not the shareholders. The shareholders have fractional interests in the corporate entity.

The corporate entity itself belongs to the shareholders. Yes, the board has been authorized to manage said entity and its belongings, but ultimately every cent is de facto owned by actors that are distinct from the enterprise*.

If i own 1% of AAPL, i own 1% of AAPL, including cash. Its mine. Not mine to do whatever i please with (the enterprise is controlled by the board, by authorization of the shareholders), but definitely still mine. I own it (hence, "share").

* to my knowledge, only foundations could own things in their own right (i.e. they have no owner in the traditional sense of the word).

 

[mccldwll]

The corporate entity itself belongs to the shareholders. Yes, the board has been authorized to manage said entity and its belongings, but ultimately every cent is de facto owned by actors that are distinct from the enterprise*.

If i own 1% of AAPL, i own 1% of AAPL, including cash. Its mine. Not mine to do whatever i please with (the enterprise is controlled by the board, by authorization of the shareholders), but definitely still mine. I own it (hence, "share").

* to my knowledge, only foundations could own things in their own right (i.e. they have no owner in the traditional sense of the word).

No. You don't. You have zero access to that theoretical 1% of the assets that you seem to think you own. All you own/have are pieces of paper that cumulatively say you own 1% of the outstanding shares, and (probably) voting rights. Your only access to cash is to sell your stock.

 

[GfPQqmcRKUvP]

No. You don't. You have zero access to that theoretical 1% of the assets that you seem to think you own. All you own/have are pieces of paper that cumulatively say you own 1% of the outstanding shares, and (probably) voting rights. Your only access to cash is to sell your stock.

I don't know how many people have been misled in their understanding of finance because of your posts in this thread, but it's getting tiring.

Let's say someone owns some shares of Apple. Is their only access to cash to sell the stock? What other actions can shareholders undertake to access their cash?

 

[mccldwll]

No, it isn't, and I don't know how many times I have to repeat this. The price is determined by future cash flow to the stockholder, which is a subset of entity earnings. The distinction is important because there has to be an expectation of return of invested capital at some point down the line.

You should stop repeating it because it's wrong. The price of a growth stock most certainly is not determined by anticipated future cash flow to the stockholder. That should be clear since there is zero likelihood of any cash flow to the shareholder for the forseeable future. (that also would be circular reasoning since the only forseeable cash to the shareholder would be the through sale at the future price). The price is determined by expected earnings of the entity. An expectation of the return of invested capital certainly is true in any investment. However, with publicly traded stocks, the expectation of return of investment plus any profit is through what I believe you previously called an "intermediary step"--sale of your stock.

----------

I don't know how many people have been misled in their understanding of finance because of your posts in this thread, but it's getting tiring.

Let's say someone owns some shares of Apple. Is their only access to cash to sell the stock? What other actions can shareholders undertake to access their cash?

You've missed the point again. His only access to that 1% of aapl assets/cash within aapl that he thinks he owns is through sale. Obviously there are many ways to extract value from the value of the shares (selling options the mist obvious), but not from the entity.

 

[mccldwll]

Mccldwell,

This is the point that people are trying to make. Eventually a stock owner wants to get more than a pretty stock certificate, they want to get cash out of their investment. Yes, they can sell the stock, but only to another person who also only wants to get cash (and not the pure pleasure of owning a share). The only exception to this that I know is the Green Bay Packers, which people do own just for the fun of it and civic mindedness.

So for a stock to have value there must be an expectation that eventually it will return cash to the owner of that stock. Even companies which have never paid dividends are expected to eventually (or at least have the ability to) (i) pay a dividend, (ii) do a share buyback, (iii) liquidate, or (iv) be acquired by another company for that company's shares (which would eventually do one of clauses (i), (ii) or (iii)).

So Berkshire may not have paid a dividend, but since it can, its owners can sell to someone else who can wait for the dividend, buyback or liquidation.

One of my concerns as an Apple Shareholder is that they are going to squander this cash. Obviously I'm not concerned enough to sell, but I'm still concerned. I think the market is concerned because the stock is certainly not trading at the level you would expect if you think Apple is going to have another 25% in earnings growth in 2012. I also recognize that I'm not in a good position to second guess the heads of Apple and their board. Their track record is pretty darn good. So I'm rolling with them and continuing to hold on to my shares.

Incidentally, I knew that Jobs would never allow a dividend. The release of cash from the company would have been release of control and he would never go for that. I became a stock owner knowing that and was ready to roll with him as the CEO as long as he was able. I was deeply saddened by his death. But it has been clear for quite some time that Apple has no use for this stockpile. I believe their decision not to pay a dividend was to appease Jobs. I expect 2012 to be another record year. I do not expect that paying out a $10 billion dividend, for example, would leave Apple with a smaller capital account at the end of 2012 than they have now at the end of 2011. Apple could easily be pulling in $2 billion a month when you consider how ramped up their iPhone production is and that they apparently still sell every single one as fast as they can make them and at a huge margin.

I'm very bullish on Apple in both the short and the long term. So for me, it seems that any dividend will be easily replaced.

I'm not worried about squandering. I anticipate another $40Bn in cash in next year, but @60% of that offshore (joining the @$55Bn offshore now). There's not ready access to much of the cash without adverse tax consequences, which I anticipate will be somewhat resolved in the next year. I think aapl has a reasonable need for a large percentage of that cash which is why I tire of people complaining about no dividend, and how it's "their money". I also think aapl will reinstitute a dividend later in 2012.

 

[GfPQqmcRKUvP]

The price of a growth stock most certainly is not determined by anticipated future cash flow to the stockholder.

I wish you would try telling someone in finance that above sentence and see how they react to an idea that is completely contrary to the most fundamental concept of valuation. Well, you already have, and I'm telling you it's wrong, but I'm getting a bit bored correcting you on the same issue, so unless we're going to shift to a different area of finance, I've said my piece.