Apple's Stock Price Reaches All-Time High Above $180 After Warren Buffett Praises iPhone Maker

Discussion in 'MacRumors.com News Discussion' started by MacRumors, Feb 27, 2018.

  1. MacRumors macrumors bot

    MacRumors

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    Apple's stock price has established a new all-time high in the company's history, as shares exchanged hands for slightly above the previous record of $180.10 in intraday trading today following several weeks of gains.

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    AAPL has been on the rise since bottoming out at $150.24 on February 9, one day after the Dow Jones plunged over 1,000 points. The broader selloff in the stock market proved to be short lived, as many technology stocks have since rebounded, and the Dow Jones is up nearly eight percent compared to a few weeks ago.

    The all-time high comes after billionaire investor Warren Buffett said his company Berkshire Hathaway has purchased more shares of Apple than any other stock over the past year. Berkshire Hathaway increased its Apple holdings by 23.3 percent, to 165.3 million shares, according to recent filings with the SEC.

    Apple shares have technically traded for higher prices, but today's all-time high accounts for multiple stock splits that have occurred over the years. Apple now has a market capitalization of well over $900 billion.

    Article Link: Apple's Stock Price Reaches All-Time High Above $180 After Warren Buffett Praises iPhone Maker
     
  2. Baymowe335 macrumors 68020

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    The greatest investor of all time now holds almost 166M shares ($28B at current value) of the best company in the world. This is Berkshire's LARGEST marketable securities holding. Gives you a sense how much Buffett likes the business and Tim Cook (besides him saying it all the time).

    By the way, this is old information as we knew Buffett added over 30M shares when the 13F was released almost 2 weeks ago. He owned over 130M shares for the last year.
     
  3. Kaibelf macrumors 68020

    Kaibelf

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    #3
    Isn’t it wild that the value of Apple has swung by $100 billion within a month?
     
  4. mtneer macrumors 68030

    mtneer

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    #5
    The Board should look at raising dividends from May onward.
     
  5. Baymowe335 macrumors 68020

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    Not when the entire market was down with it. Google briefly traded at $997.
     
  6. Krayzkat macrumors 6502a

    Krayzkat

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  7. Baymowe335, Feb 27, 2018
    Last edited: Feb 27, 2018

    Baymowe335 macrumors 68020

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    As a shareholder, I don't want dividends. I want them to buyback as much stock as they can and slowly raise the dividend, maybe 10% at a time. The stock is tremendously undervalued.

    Berkshire shareholders recently voted on a dividend proposal. 47:1 it was voted "NO" to a dividend. Dividends are not always the best way to deploy capital. I certainly don't want to pay the tax.

    Buybacks reduce share count, increase EPS, reduce dividend obligations, and avoid taxes. However, buybacks make sense at once price and don't make sense at another. I think Apple's buyback would make sense even at all time highs. Buffett agrees and he's said so.
     
  8. mtneer macrumors 68030

    mtneer

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    Fair enough. My rationale was rising stock price = unrealized benefit only due at sale, Dividend = cash in hand, now, today.
     
  9. Baymowe335 macrumors 68020

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    Let me give you the same advice Buffett did when asked about dividends. Just sell a small piece of your AAPL holdings every year and take a long term capital gain (lower tax rate, still get some cash every year). The beauty of using the money for buybacks is you can decide to pay your capital gains tax if you want a little extra cash and you're not forced into being taxed on a dividend.

    The buyback also reduces share count, increases EPS, and ultimately makes your shares more valuable, assuming the stock is undervalued (which Apple and I believe is the case). Apple's buyback has been very successful. Their average price is something insane like $120/share.
     
  10. timborama macrumors 6502

    timborama

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    They always do in May.
     
  11. az431 macrumors 6502a

    az431

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    #12
    As a shareholder since 1996 I want both. At this point if I was to sell any of my stock over 99% of the proceeds would be taxable as capital gain. Dividends allow actually using the stock appreciation without selling stock.
     
  12. WannaGoMac macrumors 68020

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    Yep, thats what Buffet says as well. Yet he tends to invest in companies that pay dividends haha
     
  13. az431 macrumors 6502a

    az431

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    #14
    That strategy makes sense for someone who has held the stock short term, but for a long term holder it doesn't result in any tax savings. And long term you lose out on the appreciation of the stock you sold.

    Either way the discussion is academic because Apple is highly unlikely to eliminate dividends. You'll see iOS on Samsung devices before that happens.
     
  14. ArtOfWarfare macrumors G3

    ArtOfWarfare

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    #15
    What goes up must come down.

    I really want to sell and lock in what I've gotten on this, but I've only held it since August, so taxes will be about double on it what they'll be if I hold it another 5 months... the question I keep wondering is, will it manage to remain this high (or higher) for another 5 months? Or will it drop by enough that I should just swallow the taxes now?

    I'm really overthinking it, given AAPL is only 3% of my portfolio, and I only have a single share of it. It's only the second share I ever bought, and will mark the first share I ever sold.
     
  15. Baymowe335 macrumors 68020

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    Even at the highest bracket, capital gains are only taxed at 20% and more likely will be 15%. Sell a little of the stock if you need some cash. Many investors DRIP anyway, so the dividend is not kept in cash.

    Buffett wants buybacks too. It's just better and why Berkshire doesn't pay dividends.
     
  16. ghanwani macrumors 6502a

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    #17
    In front to hit $1T market cap! Tim Cook has done really well for Apple.
     
  17. Glideslope, Feb 27, 2018
    Last edited: Feb 27, 2018

    Glideslope macrumors 603

    Glideslope

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    #18
    Bubble. Warren is getting Senile. Q2 call will change things. :apple:
     
  18. Baymowe335 macrumors 68020

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    I'm not advocating Apple ELIMINATING the dividend. I just don't want them to substantially raise it or do a special dividend (something Cook already shot down).

    Long term capital gains are taxed at a lower rate than short term (ordinary income) so the strategy makes sense for long term investors. If you need some extra cash, sell a few shares and pay the long term capital gains rate. This is a strategy Buffett advocates for folks that need the cash. Buybacks create long term value. Dividends are just cash payments.
    --- Post Merged, Feb 27, 2018 ---
    Said no one ever. Buffett at 87 is incredibly sharp. I watched his entire 3 hour special on CNBC and he hasn't lost anything.

    And Apple being a bubble? LOL!! I guess you forgot the entire market was crushed earlier this month and created massive market swings.

    NFLX and AMZN are certainly closer to bubble territory at 200 and 350 times, respectively than AAPL at 15 times earnings.
    --- Post Merged, Feb 27, 2018 ---
    Just some friendly, free advice. Stop thinking about the price. You own a business. Will Apple be worth more or less in 5 years? Think about it this way. Markets can do anything. The same company traded at $150 just 3 weeks ago because markets overall became irrational. You can't make decisions based on what the stock price is doing.

    You sell the Apple and then what? You buy something else and have similar worries.

    My mentality is I own Apple, the business, not the stock. If something materially changes the business model, I will reevaluate my position. I was confidently buying shares when the market knocked AAPL from all time highs a few weeks ago because I know the facts and overall narrative have no changed, despite the change in share price.

    You only sell when you believe the facts have change and the business is no longer headed for success. You don't sell because the quoted price reached a certain number.
     
  19. melgross macrumors 6502

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    #21
    And now it’s down again as the market drops.
     
  20. Glideslope macrumors 603

    Glideslope

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    Revisit your portfolio after the Q2 call and Q3 guidance. ;)
     
  21. SgTest123456 macrumors newbie

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    #23
    Granted I am bias as hold AAPL and general bullish on it but I think that market has not fully digest the fact that they are going to spend prob $100b or more buying back the stock. Think about this...if they do do this sharebuyback it is roughly 12% of the market cap will disappear via share outstanding and being retired. You are going to have the mother of all short squeze on the stock. I could see $220 PPS...

    Btw we may see a annual dividened but not going to be a one time dividend as Tim doesn't like it and also he mention they want to do something that rewards long time holder of the stock. One time dividends penalize long time holder as they would be getting double tax on the amount and it is tax based on income rate.
     
  22. citysnaps macrumors 68040

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    #24
    Smart move on Mr. Buffett's part. Apple is undervalued.
     
  23. IJ Reilly macrumors P6

    IJ Reilly

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    #25
    Likewise, though I've been in AAPL "only" since 1997. A cost basis of under a dollar a share is great problem to have but it does mean you need to think about the tax consequences of selling.
     

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