http://www.zdnet.com/cook-doesnt-like-apples-share-price-but-urges-patience-7000011950/
Apple's CEO, Tim Cook had a meeting with shareholders who were concerned about the steep fall in the share prices. At the annual shareholders' meeting, Cook assured shareholders that in the long term, Apple stock is certain to rise in value. Though he did not share his strategy for assuring this rise in stock prices, it is expected that Apple is going to launch several products in the coming period which are most probably going to increase its share price.
However, another issue raised at the meeting was Apple's reluctance to share its cash holdings and securities with the shareholders. Shareholders are understandably not pleased with the fact that Apple has around $130 billion in Cash and Securities and is unwilling to distribute some of that among shareholders, even in times of falling share prices
Apple's CEO, Tim Cook had a meeting with shareholders who were concerned about the steep fall in the share prices. At the annual shareholders' meeting, Cook assured shareholders that in the long term, Apple stock is certain to rise in value. Though he did not share his strategy for assuring this rise in stock prices, it is expected that Apple is going to launch several products in the coming period which are most probably going to increase its share price.
However, another issue raised at the meeting was Apple's reluctance to share its cash holdings and securities with the shareholders. Shareholders are understandably not pleased with the fact that Apple has around $130 billion in Cash and Securities and is unwilling to distribute some of that among shareholders, even in times of falling share prices
The $130 billion in assets is something that I think should be used to distribute to shareholders. Even if the entire $130 billion is not used, some of it should be given back to the shareholders.
ReplyDeleteI agree. There are theories on dividends and weither or not it increases or decreases the value of a firm. In this case, since Apple has seen a very sharp decline in equity, the distribution of a portion of the $130 billion could incentivize investors to hold their stake. To be honest, Apple has not done much R and D except make a smaller iPad and a colorful iPod Touch, so this cash could be used for dividends and benefit the price of equity.
DeleteIf your stock value is falling and you have 130 billion in cash and securities, then Applebees should be giving their shareholders some sort of dividends to keep their moral high...people respond to incentives.
ReplyDeleteOne clever way to tackle the falling stock value, the huge cash reserves, and the discontent shareholders is to offer a stock buy back. Using the $130 billion to buy back stock would reduce the supply of stock on the market, thereby increasing the price. This would make shareholders happier, and also reduce the cash assets Apple is currently holding.
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