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Apple has been sitting on large amounts of cash for several years and has yet to take a decision on how to use that cash. If they're not buying anything they s

Apple has been sitting on large amounts of cash for several years and has yet to take a decision on how to use that cash. If they're not buying anything they should repurchase stock or pay dividends, but either way, you can totally see they don't have a clear M&A strategy. I mean, Beats? Shazam?... Apple has the financial power to buy a large supplier and reduce costs by vertically integrating their supply chain but they rather choose to pursue opportunities that have little to no impact on their added revenues.

greedo 9y ago
They have been both repurchasing stock and paying dividends for several years...
- whoisjuan 9y ago
  Never at the scale of their cash reserves and cash growth. In 2014, Apple had 100 billion in cash and now 4 years later they have 250 billion in cash. During the past 10 years, Apple's average free cash flow per share growth rate was 31.40% per year. They keep hoarding cash. None of that cash has been deployed or reinvested in a meaningful way. Their stock repurchase plan and dividend payments have been pretty miserable for a company with that amount of disposable cash. From the top 10 biggest annual dividends payers in S&P 500, Apple is the most stingy. Their yield is 1.72%. Compared to other companies with yields of up to 5% (like AT&T), that's actually a shitty dividend payout.
  - btilly 9y ago
    That's because they have it all locked away in tax shelters. Tim Cook announced Jan 17 that he intends to bring most of the money back, and pay close to $40 billion in penalties. Presumably a lot of that will get returned to investors or reinvested in some way.
    - jonknee 9y ago
      > and pay close to $40 billion in penalties That's a funny way to pronounce lowered taxes.
      - btilly 9y ago
        If he simply continued to do what he is already doing, he would pay $0 in taxes..indefinitely. Viewed that way this is clearly a penalty for changing course.

greedo 9y ago

They have been both repurchasing stock and paying dividends for several years...

whoisjuan 9y ago
Never at the scale of their cash reserves and cash growth. In 2014, Apple had 100 billion in cash and now 4 years later they have 250 billion in cash. During the past 10 years, Apple's average free cash flow per share growth rate was 31.40% per year. They keep hoarding cash. None of that cash has been deployed or reinvested in a meaningful way. Their stock repurchase plan and dividend payments have been pretty miserable for a company with that amount of disposable cash. From the top 10 biggest annual dividends payers in S&P 500, Apple is the most stingy. Their yield is 1.72%. Compared to other companies with yields of up to 5% (like AT&T), that's actually a shitty dividend payout.
- btilly 9y ago
  That's because they have it all locked away in tax shelters. Tim Cook announced Jan 17 that he intends to bring most of the money back, and pay close to $40 billion in penalties. Presumably a lot of that will get returned to investors or reinvested in some way.
  - jonknee 9y ago
    > and pay close to $40 billion in penalties That's a funny way to pronounce lowered taxes.
    - btilly 9y ago
      If he simply continued to do what he is already doing, he would pay $0 in taxes..indefinitely. Viewed that way this is clearly a penalty for changing course.