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Apple Shareholder Meeting: No Dividend or Stock Split, Majority Vote Requirement for Directors
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with 100 billion Apple could start their own manned space program to go to Mars and claim it on behalf of the company.... hmmmmm...... but what color would the space ship be?
If you really bought AAPL for the hopes of dividends you never should have bought. But please tell me of any dividend issuing stock that has been as financially rewarding in the past five years? AAPL is a growth stock...still growing. If you are looking for a dividend go buy MSFT. I'm guessing your return this time next year will be a pittance compared to what AAPL does in the same period.
Probably no company has been as financially rewarding over the past five years, so I guess that's a trick question. I bought AAPL when the company had about $1B in cash and was losing money. Now they sitting on over $100B in cash and add $1B more almost weekly. So the circumstances have changed, just a little. As to your non-trick question, I think this should answer it:
http://seekingalpha.com/article/358321-an-apple-dividend-is-on-its-way-and-the-smart-money-knows-it
The downside for investors? None. The upside? Potentially huge. But if you don't want that extra dough, maybe you should be the one investing in MSFT.
I think controversial and "age appropriate" are two entirely different things. I wouldn't let my daughter watch the news sometimes or desperate housewives. Does that make them "controversial"? Not really.
When i think "controversial ", i think about something that is hugely debated and offensive on a number of different levels. Family guy? Nahhhh. It can be offensive, but i don't think anybody really takes it seriously. When you watch, you know what you're getting yourself into. Distasteful ridiculous jokes
"Other topics included Apple's advertising on controversial television shows".
Who asked this question, some family values nut who has a wife, two kids and a boyfriend on the side?
Frankly, I'm glad Apple has decided to not issue dividends or split their stock!
Who asked this question, some family values nut who has a wife, two kids and a boyfriend on the side?
Frankly, I'm glad Apple has decided to not issue dividends or split their stock!
Family Guy I understand, in fact there are times when I turn my nose up at that one. But the Simpson's?
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uh what? shareholder means you own a share of the company a share is a part of something, they work for the shareholder technically.
correct me if some parts are incorrect but I'm pretty sure there not
I don't really care. Shareholders be damned. When they set the policies, they never do anything good. All they want is coupons to clip.
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Tim Cook keeps wanting to do things that Steve was against..charity/dividends
And he feels the company has more cash than it needs, that's not a very good view in terms of the future
Tim Cook keeps wanting to do things that Steve was against..charity/dividends
And he feels the company has more cash than it needs, that's not a very good view in terms of the future
Dividend is a bad idea in the tech field which changes so rapidly year to year. You need cash to be able to redirect development to take advantage of new markets and trends in timely fashion as they evolve. R&D emphasis also depends on cash, not divis. As a shareholder I am very happy they are not falling victim to media hype about divis. Cook should just ignore them. The media people always seem to like to complain about something or other even if a company is doing well as it is.
As a Canadian investor, an Apple divi would suck for me because I hold some of my AAPL outside the RSP so these divi's would not qualify for dividend tax credit. I would be taxed at the full marginal rate, i.e., same as interest income. A lot of Canadian shareholders would probably have to sell some AAPL if a divi was approved.
As a Canadian investor, an Apple divi would suck for me because I hold some of my AAPL outside the RSP so these divi's would not qualify for dividend tax credit. I would be taxed at the full marginal rate, i.e., same as interest income. A lot of Canadian shareholders would probably have to sell some AAPL if a divi was approved.
Apple's spending is getting to be profligate. Hardly a week goes by these days where you don't hear about a new retail outlet, philanthropy, environmental project or other such nonsense opening up.
The danger of keeping this much cash on hand, is that management lacks discipline.
Some data backs this up.
http://www.marketwatch.com/story/ap...us-temptation-2012-02-24?reflink=MW_news_stmp
The danger of keeping this much cash on hand, is that management lacks discipline.
Some data backs this up.
http://www.marketwatch.com/story/ap...us-temptation-2012-02-24?reflink=MW_news_stmp
Dividends are not additive to shareholder value. Look at it logically. Right now, Apple is worth around $481 billion. Without its $100 billion in cash, Apple is worth $381 billion. If Apple pays out a 3% dividend, that is approximately $14.43 billion. Apple is giving that cash to its shareholders. That cash no longer belongs to Apple. Its market cap will go down by $14.43 billion.
This is not correct. Market cap (MC) is based on current share price x the number of outstanding shares. Were Apple to pay a dividend, it may or may not affect their MC. It certainly doesn't go down based on a dividend payout.
Silver and black.
Loaded with the genetic code of 100 million iHipsters
to grow organic material for the terraforming of the red planet.
Magic.
Apple has $100 billion invested getting terrible returns. It isn't using that money. If it had paid a dividend a year ago, I would have taken the dividend and bought more Apple stock. (Like most investors all of my stock is set to reinvest a dividend in itself, so that is literally what would have happened for me and most investors.) Apple's stock went up 50% last year. If I had gotten a dividend from Apple, I would have made a 50% return on that dividend in one year. Instead Apple invested that money in U.S. treasuries and they made 2% on it. Apple did great by me, but it could have been even better if they had paid a dividend.
And at what point does this stop? If Apple's cash horde is $140 billion by the end of the year, then do they pay a dividend? $300 billion by the end of 2013? What is the threshold where they should pay and why is it there and not at the current $100 billion when they clearly don't have any plans or need for the money?
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Yes it does because cash flows out of the company with a dividend. However, the $100 billion invested at 2% or maybe even less is a drag on Apple's share price. If you want to buy Apple the company, currently you have to pay $400 for a share of the company and $100 for a piece of the cash horde that is being invested in investments returning less than the rate of inflation. The cash horde isn't innovating, that is the company. The company is what you want to invest in, you don't want your investment in Apple to be partly a U.S. treasuries play.
Cook's getting better and better at public speaking. Famously the quiet man who runs Apple ops, he seems to be growing in stature in the last few months. I'm beginning to think he might be a better CEO -- at least on some levels -- than Jobs. You?
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Cash on a company's books is not subtracted from their market cap. Neither is debt added. The only interest you might have in either as an investor is the income they generate from cash investments and expenses from debt servicing costs. These show up in earnings, but the cash and debt itself does not. Debt and cash would also interest you if you are planning on taking over the entire company because then you'd own all of the company's assets and liabilities. Ordinary stockholders don't own either of them, only a share of equity.
But you are right, if a company accumulates more capital than they can use for investing back in growing their business, then it's incumbent on the board to make some other use of the excess. Dividends and/or share buybacks are the most typical uses of excess cash.
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Okay then, if you get a dividend check you can sign it over to me, since it adds nothing to your shareholder value.
I think you need to read that seekingalpha article I linked above.
I agree that cash is not subtracted from market cap. But it provides a floor for the share price. On cash alone, Apple is worth around $100 per share. Suppose Apple's share price dropped below $100 per share. Apple would take the company private in no time.
It doesn't really do that either. A company's stock can be worth less than its liquid assets, book or enterprise value. Apple was in that situation not too many years ago. When the markets are negative about the company's prospects for growing their business (or think they may go out of business) they may well value the company at substantially under these accounting numbers. But even more importantly I don't think any AAPL investor is keen on the idea of a "floor" share price of less than 20% of the current market value. That would require (and be) an unmitigated disaster. In fact talk like that kind of makes me nervous.
AAPL is currently overpriced by a considerable margin. My triangulation between their terminal/enterprise and intrinsic value (net current assets plus operating DCF) puts them around $420 per share. This doesn't mean that's my "target price" that I am betting they'll drop to. That's what my estimation of the net present value of the operating cash and working capital. How big a bathroom Tim Cook has is of no consequence to how much cash they can readily generate from operations.
So if they were to drop below $420 a share I might consider them a bargain, but I'm preoccupied with picking up all the other available bargains that the market isn't hovering around like gnats the way they're obsessed with AAPL.
I would probably continue to keep their foreign investments, cash and equivalents because at any time, being the biggest target in the world, they could get embroiled in massive litigation or see other catastrophic events that might otherwise capsize a heavily leveraged company. The opposition to Apple holding that cash is using a circular argument... the people who are arguing that Apple should go spend the money as if it's burning a hole in their pocket are not considering that the excess cash is part of how they remained stable in a very economically uncertain period, and that growth of share of wallet isn't something they can just manufacture out of thin air... So it's not as if Apple can just spend the money and acquire even more share of wallet overnight.
They're already on top... it's time to pace themselves into sustained growth because there's more uncertainty ahead with Foxconn issues and the eventual depletion of the product line that Jobs had direct influence in, as well as shrinkage of overall growth because the remaining available pool of share of wallet shrinks as Apple scales upward.
If anything I'd say do a partial share buyback and avoid splits... don't fall into that pit of increasing speculative activity when you're the market leader. There's no advantage to it. The stock price will go up on scarcity alone. It may piss off some speculative yahoos who are hoping to jump on an "easy cash" train rather than do some homework around real investments, but dilution is always deleterious for those of us who are serious long term investors. Furthermore, if a management team knows what they're doing better than I do, I'd rather they keep the cash instead of pay me dividends because they can turn it into greater growth than I can. Dividends are great if you're invested in a company helmed by average managers who can keep generating steady operating cash but perhaps not better year over year returns than you...
But that's all relative. Even very few fund managers can consistently beat the S&P year over year... and those that do work for Warren Buffett... so why should Berkshire pay dividends? See what I mean?
A shrewd investor is cashing out of Apple and moving on to what's currently underpriced by the market.
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The concept of over or under-pricing of stocks is a phantom. It's the phantom that stock-pickers chase, almost always without success. Nobody really knows until after the fact whether a stock was under or over-valued since the markets are constantly pricing in everything which is actually known. Everything else is guesswork. This is not my own idea -- lots of important work by economics backs up this statement.
That said, important work also backs up the idea that the best stocks of any given time period are unlikely to be the best investments in the next. At some point, AAPL will begin to stall. The trick is picking the next big winner before anyone else does. Nobody can do this with any consistency. This isn't a theory, it's a proven fact.
I've ridden this AAPL bull for nearly 15 years now. I made one great investment guess in my life. I consider myself to be extremely lucky, not smart. Consequently, my AAPL profits are going into index funds, where you don't have to be lucky to make money, just persistent and steady.
The only thing I don't agree with is the concept that good management can necessarily turn cash on hand into a good investment. Even good management can't always do that and it becomes harder and harder to find investments that are worth putting the cash into play.
For example, if I told you you have to buy a car and you have to spend $100,000. Then you have to justify to me that you got good value for your purchase. Well I think you could do that.
But if I told you you have to buy a car and you have to spend $10 million on it. And then you have to justify to me that you got good value for your money, well I think that would be harder.
Apple has made good strategic acquisitions in the hundred million dollar range. But they haven't done any tens of billion dollar acquisitions. We have evidence that for years now Apple's management has not been able to find good investments for its cash. The evidence is that the cash just sits there year after year. Apple's management has made great moves over the last several years, but these moves have not required them to deplete cash reserves on anything more than a very short term basis.
For example, if I told you you have to buy a car and you have to spend $100,000. Then you have to justify to me that you got good value for your purchase. Well I think you could do that.
But if I told you you have to buy a car and you have to spend $10 million on it. And then you have to justify to me that you got good value for your money, well I think that would be harder.
Apple has made good strategic acquisitions in the hundred million dollar range. But they haven't done any tens of billion dollar acquisitions. We have evidence that for years now Apple's management has not been able to find good investments for its cash. The evidence is that the cash just sits there year after year. Apple's management has made great moves over the last several years, but these moves have not required them to deplete cash reserves on anything more than a very short term basis.