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Apple To Launch Largest Stock Repurchasing Plan In History

Soulskill posted about a year ago | from the not-sure-if-confidence-or-overconfidence dept.

The Almighty Buck 282

An anonymous reader writes "In conjunction with its earnings report for the second quarter of 2013, Apple issued a press release announcing some major plans for its ever growing stockpile of cash. It is increasing its quarterly dividend payout to investors by 15%. What's more, the company will spend $60 billion in stock repurchases, making it in Apple's words, 'the largest single share repurchase authorization in history.'"

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Dumbest idea, ever (2, Insightful)

faragon (789704) | about a year ago | (#43530729)

In my opinion, they just will burn their cash. It is inevitable: they must lower device prices, so their shares will fall. No way out.

Re:Dumbest idea, ever (1, Troll)

Kimomaru (2579489) | about a year ago | (#43530765)

That, OR they might want to start coming up with some new ideas. Clearly the ship's been without a captain since Jobs passed away. This is TOTALLY part of a Hail Mary. They have no idea how they're going to keep this thing going.

Re:Dumbest idea, ever (5, Insightful)

Anonymous Coward | about a year ago | (#43530829)

Oh my. Here we go again. Apple is going out of business now like Microsoft was suppose to be for the last 15 years?
 
If I've learned anything here I've learned that the average "geek"* doesn't have the first clue about business.
 
* I use that term loosely anymore. The geek element certainly has waned over the last few years. I blame KDawson.

Re:Dumbest idea, ever (3, Informative)

bughunter (10093) | about a year ago | (#43531253)

This is one of the most insightful comments I've ever seen attached to a /. story with 'Apple' in the title.

(I know, that's faint praise...)

Re:Dumbest idea, ever (0)

AuMatar (183847) | about a year ago | (#43531345)

If they had ideas, they wouldn't be doing a share buyback. A share buyback means they have more cash than they have good ways to spend it, so they'll buy shares back to decrease the pool of available shares, thus increasing the ownership percentage of a single share (thus its value). The combination of that plus a dividend increase means that they have more money than they can possibly use.

They have lots of new ideas, some still from Jobs (4, Insightful)

SuperKendall (25149) | about a year ago | (#43531393)

That, OR they might want to start coming up with some new ideas.

Well Apple takes on average about two-three years to deliver products that create entire markets.

So they are about due, and Cook said there were some surprises coming in the fall.

But it's absurd for you to mention Jobs in this context, products take many years to complete. It will be at least two more years before we see products that never had input from Jobs, including this one.

It's also kind of funny how Apple "needs" to come up with new ideas, when no other company seems to have the same need... or at least no-one ever says they do.

Re:They have lots of new ideas, some still from Jo (1)

geekoid (135745) | about a year ago | (#43531777)

What are you talking about? they have created 1 new market, tablets.

Re:They have lots of new ideas, some still from Jo (3, Interesting)

wavedeform (561378) | about a year ago | (#43531823)

It depends upon what you mean with the word "created." They certainly changed the face of computing, mobile music players, smart phones, and tablets. All of these categories existed before Apple got into the market, but once Apple decides on an approach, other companies seem to try and do things in a similar way.

Re:Dumbest idea, ever (0)

Dunbal (464142) | about a year ago | (#43531677)

New ideas? Hell, that hasn't happened yet.

Re:Dumbest idea, ever (0)

Anonymous Coward | about a year ago | (#43530781)

But they need to do something to stop their share price from plummeting, I bailed quite close to the high because I couldn't see the justification for that price, sure had I held out I could have made an extra $20 a share but a little longer than that would have been nasty :)

Their products have grown mature now, to continue growth and increasing value they need a new product, not just predictable (and often disappointing) re-hashes of their existing line.

Re:Dumbest idea, ever (1)

Tough Love (215404) | about a year ago | (#43530987)

Apple will never get back to those windfall margins in the phone or tablet space, ever.

Re:Dumbest idea, ever (2)

Dcnjoe60 (682885) | about a year ago | (#43531189)

Apple will never get back to those windfall margins in the phone or tablet space, ever.

They don't need to. If you buy back shares, then the lower margin on the devices equates to an equivalent dividend per share.

Re:Dumbest idea, ever (-1, Troll)

Tough Love (215404) | about a year ago | (#43531127)

Apple's product ideas died with Steve Jobs. Tim Cook is a complete limp wrist. Example brilliant Tim Cook idea: make the new iphone too long and not wide enough, because increasing the horizontal pixel count is way too scary.

Re:Dumbest idea, ever (0)

sethmeisterg (603174) | about a year ago | (#43531141)

Got news for ya there, Captain Compost. The iPhone 5 was Jobs's design. How does that fit in with your little troll story?

Re:Dumbest idea, ever (1)

Tough Love (215404) | about a year ago | (#43531379)

Fits perfectly. Things changed after Jobs died. In fact, they changed while he was dying. Top selling phones got bigger and wider. Tim Cook failed to respond. Blaming that on a dead man is a cop out. When you get right down to it, Tim Cook's main superpower would appear to be blame deflection, just as you say.

Re:Dumbest idea, ever (1)

Karlt1 (231423) | about a year ago | (#43531521)

Re:Dumbest idea, ever (0)

Tough Love (215404) | about a year ago | (#43531683)

http://www.engadget.com/2013/04/04/comscore-february-2013/ [engadget.com]

Android subscribers: 51.7%
iPhone subscribers: 38.9%

Apple can at best claim a short term reversal of an alarming trend (for it) in the US market at the cost of significantly reduced margins. In other news, Apple is getting hammered in the world market. China is turning into a major disaster for Apple, and will soon be a larger market for smartphones than the US.

Re:Dumbest idea, ever (1)

Sponge Bath (413667) | about a year ago | (#43531589)

Top selling phones got bigger and wider.

At one point so did suit lapels and blue jean bottoms.

Re:Dumbest idea, ever (1)

Tough Love (215404) | about a year ago | (#43531711)

Wow, you Apple cultists are creative. At least there's that. Logic is optional.

Re:Dumbest idea, ever (0)

ArcadeMan (2766669) | about a year ago | (#43531165)

1. The iPhone 5 was approved by Steve Jobs way before he died.
2. The iPhone is the right width for the human hand. Any larger and you need two hands to use it. It's a phone, not a tablet.

Re:Dumbest idea, ever (0)

Anonymous Coward | about a year ago | (#43531301)

One size doesn't fit all. I have never had anything in that category fit me. Guess that's because I have huge hands and was like the only one who absolutely adored the original xbox controllers.

Re:Dumbest idea, ever (-1)

Anonymous Coward | about a year ago | (#43531513)

Ok, now that we got the opinion of the sideshow attraction out of the way....

Re:Dumbest idea, ever (3, Insightful)

Anonymous Coward | about a year ago | (#43531563)

Gotta love how apple zealots can state exactly how wide the "correct" human hand is and what the capabilities the "correct" person who might use a phone are. I guess when you are a member of a cult masquerading as a cell phone company this is exactly the "right" kind of group think to have. No room for natural variation or a difference of opinion. If you don't like it the problem is YOU and certainly not the cult of Apple.

Re:Dumbest idea, ever (3, Insightful)

PixetaledPikachu (1007305) | about a year ago | (#43531767)

Gotta love how apple zealots can state exactly how wide the "correct" human hand is and what the capabilities the "correct" person who might use a phone are. I guess when you are a member of a cult masquerading as a cell phone company this is exactly the "right" kind of group think to have. No room for natural variation or a difference of opinion. If you don't like it the problem is YOU and certainly not the cult of Apple.

That's not something new. They used to claim that their display has just the perfect amount of pixels for every person on earth, since apparently everyone has the same viewing distance when looking at their phone, anywhere, at any given time

Re:Dumbest idea, ever (0)

Anonymous Coward | about a year ago | (#43531607)

I use my Galaxy Nexus with one hand just fine. Stop buying into the iPropaganda.

Re:Dumbest idea, ever (4, Interesting)

atheistmonk (1268392) | about a year ago | (#43531695)

I have small hands and my Galaxy S2 is very easy to use one handed. I must be doing something wrong to be able to use the phone that is the wrong width for the human hand so easily.

Re:Dumbest idea, ever (1)

rjr162 (69736) | about a year ago | (#43531749)

Weird... because I dont have large hands and the note II fits fine

Re:Dumbest idea, ever (1)

geekoid (135745) | about a year ago | (#43531817)

1) So? Steve Jobs made many, many mistakes.

2) It's nice the Apple has dictated the corect width for a human hand. If my hand are bigger do I go to the apple store to get the correct size hands, or have the Robot Devil chop them off and mail them in?

Re:Dumbest idea, ever (3, Informative)

Karlt1 (231423) | about a year ago | (#43531505)

It strange that now Slashdot Wisdom(tm) is Apple came out with new ideas every year when SJ was alive.

Apple's market changing innovations were.....

1998 - iMac

2001 - iPod

2003 - iTunes

2007 - iPhone

2010 - iPad

So, by that pattern, this would be the year that Apple "needs to innovate". But there is no conceivable market larger than the phone market.

Re:Dumbest idea, ever (-1)

Anonymous Coward | about a year ago | (#43531569)

But there is no conceivable market larger than the phone market.

Apart from food, water, and air.

Re:Dumbest idea, ever (2)

Tough Love (215404) | about a year ago | (#43531723)

But there is no conceivable market larger than the phone market.

Apart from food, water, and air.

iFood! Milled out of solid aluminum.

Re:Dumbest idea, ever (0)

Tough Love (215404) | about a year ago | (#43531585)

Apple's product ideas died with Steve Jobs. Tim Cook is a complete limp wrist. Example brilliant Tim Cook idea: make the new iphone too long and not wide enough, because increasing the horizontal pixel count is way too scary.

Wow, Apple cultist spinmods really do not like having the obvious pointed out to them. Get over it. Magic Apple died with Steve Jobs. Sunset Apple has arrived.

Re:Dumbest idea, ever (4, Insightful)

Cinder6 (894572) | about a year ago | (#43531431)

Apple's stock has always been weird. Their P/E ratio is lower than Dell's. Doesn't make sense to me, but I'm not a finance guy.

Re:Dumbest idea, ever (0)

Anonymous Coward | about a year ago | (#43530791)

Or they plan to take the company back private.

Re:Dumbest idea, ever (2, Insightful)

bloodhawk (813939) | about a year ago | (#43530809)

It isn't dumb, I don't like Apple but it is actually a smart move. They need to return shareholder value as their growth proposition going forward is uncertain or potentially even negative. The choices are return shareholder value through dividend and buybacks or watch the stock slide.

Re:Dumbest idea, ever (0, Flamebait)

Tough Love (215404) | about a year ago | (#43531009)

Translation for those unfamiliar with the drill: Apple shareholders want their money back now because they expect Apple management to steal or waste it otherwise.

Re:Dumbest idea, ever (5, Informative)

bloodhawk (813939) | about a year ago | (#43531149)

It really isn't so much that they are going to waste it (though that is always a concern). investors/shareholders make money from one of 2 ways (like it or not investors are their to make money), either the shares go up in value or they receive an income as dividend from those shares. Apple doesn't have to provide stellar growth, they can continue on with their excellent profit and earnings with no growth, however to do so they need to change the way they are returning value as without growth shareprice will stagnate which means you have just removed the traditional way that Apple investors were getting value from the shares. buybacks and dividend allow investor returns while also bolstering the shareprice through desirability as an investment. What they are doing makes sound business sense even if like me you despise them.

Re:Dumbest idea, ever (3, Interesting)

proverbialcow (177020) | about a year ago | (#43531011)

Agreed. Repurchasing and boosting the dividend when the stock traded above $700 might have been a good idea; doing so when it's hovering around $400 with a PEG ratio of 47% is a good idea. Buying back your own stock at a discount to what it's worth, while simultaneously returning cash to shareholders and appeasing a huge PITA activist investor? That's smart.

Financing the buyback with debt is a tiny bit worrisome, but Apple's probably just taking advantage of the low interest rates their high credit rating and hoard of cash afford them.

Re:Dumbest idea, ever (1)

fleebait (1432569) | about a year ago | (#43531385)

Financing the buyback with debt is a tiny bit worrisome, but Apple's probably just taking advantage of the low interest rates their high credit rating and hoard of cash afford them.

Short term financing vs. long term financing. Borrowing money today, when they can probably get it somewhere less than 2% interest, vs a future interest of 7% (or more) within the next 5 years, is not a bad bet. It's called "putting the cash to work". Cash just sitting in the bank doesn't make anything.

Taking this position, if they maxed out their value, they could shut down sales for a year, do research, and still survive. With Apple's strength it is a wise move.

This is all about good financial management. and nothing about products.

Re:Dumbest idea, ever (2)

mosb1000 (710161) | about a year ago | (#43530849)

What else are they supposed to do with it? Selling hardware at a loss is always a loosing proposition, and there's no way you can spend that amount of money efficiently on R&D. Their only options, really, are sitting on it or giving it to their investors.

Re:Dumbest idea, ever (0)

Tough Love (215404) | about a year ago | (#43530961)

In my opinion, they just will burn their cash. It is inevitable: they must lower device prices, so their shares will fall. No way out.

Most accurate comment ever. Apple defeated by Android/Linux, who woulda thunkit?

Re:Dumbest idea, ever (0)

Anonymous Coward | about a year ago | (#43531705)

Actually, your idea is the dumbest ever. Apple doesn't need to lower prices, they are still hugely successful at their pricing, that's how they got so much $$$ in the first place, because people will pay.

Could have bought Apple stock (3, Funny)

mederbil (1756400) | about a year ago | (#43530731)

But I'm glad I invested in Bitcoin.

Points at Apple (0)

Anonymous Coward | about a year ago | (#43530751)

Hideki!

Why? (1)

Hentes (2461350) | about a year ago | (#43530777)

Why do they increase the divident if they want to purchase their stock? They are driving up the price they will have to pay.

Re:Why? (2)

Intrepid imaginaut (1970940) | about a year ago | (#43530787)

Do the executives get paid in or own any stock?

Re:Why? (0)

Anonymous Coward | about a year ago | (#43530857)

Shareholders money is still shareholders money.

Re:Why? (1)

Anonymous Coward | about a year ago | (#43530869)

Dividends encourage people to own stocks for longer periods of time, same as stocks which don't split. The buying back of shares means that the money management thinks that the price of the stocks is less than what it should be.

Either way is potentially a good idea, but honestly I don't follow Apple closely enough to know if it makes any sense. I personally think that Apple is even now way too pricey given the uncertain future and need for them to innovate into new areas to keep growing.

Re:Why? (2)

mosb1000 (710161) | about a year ago | (#43530875)

Repurchasing stock is meant to increase shareholder value, raising the dividend is meant to do the same. Apple investors have been asking when they will get to see some of the money Apple's been making. This is all meant to keep their investors happy.

Re:Why? (3, Insightful)

Tough Love (215404) | about a year ago | (#43531089)

Repurchasing stock is meant to increase shareholder value, raising the dividend is meant to do the same.

The latter is completely wrong (other than tax treatment, dividends have a neutral effect on shardholder value). The former is correct only because a company acting rationally will only purchase its own stock if it is confident that the stock is undervalued. It is far from clear to me that Apple's stock is undervalued.

Re:Why? (0)

Anonymous Coward | about a year ago | (#43530927)

They aren't trying to buy X number of stock, they are trying to spend X amount dollars (returning $ to shareholders).
Increased price just means they will buy back less stock with same amount of $, which is fine because the number of shares
only matters if you are trying to change the ownership structure of a company that you are taking over, which isn't the case here.
Both stock repurchase and dividend increase both do this, and doing them both is just averaging the approaches,
as well as giving an indication that the future profits released as dividends will be baselined 15% above current levels
  (total value, so in future dividend per share will be further inflated for reduced numbers of shares after buy-back)

Re:Why? (2, Informative)

Tough Love (215404) | about a year ago | (#43531037)

It is a myth that dividends drive up the price of stock. The simple relation is this: after the dividend is paid, the company no longer has the money so the stock is worth less. You can easily verify this, just look at the price of any stable company on the ex div date. It will be lower by roughly the dividend.

Re:Why? (0)

Anonymous Coward | about a year ago | (#43531199)

Oh for god's sake, what? "They're giving away part of the company so it becomes worth less!" or something?
The ex-dividend price drop is the mirror of the prior jump for the effective dividend date. People will move on a stock for the dividend, and many already planning to sell will hang on until the dividend date and THEN sell, just to have that much more in their pockets. It's SELLING pressure that moves the price down in the vast majority of cases, not anything to do with the actual VALUE of the dividend.
Fuck.

Re:Why? (2, Informative)

Alomex (148003) | about a year ago | (#43531287)

You are wrong. Stocks that pay dividends show this wave pattern where the price rises just before the dividend as it approaches. However this crest pattern does not preclude nor negate a long term gain in the stock price.

Re:Why? (3, Informative)

Tough Love (215404) | about a year ago | (#43531337)

If a stock rises as the dividend date gets closer, purely because of the dividend then those new buyers are just gullible, and the everybody who failed to value the company accurately is just stupid. Proof: if we could rely on a stock price increasing just before the dividend then we would bid up the price right now, well before the dividend. And so the stock would not rise in advance of the dividend because it was already fully valued. See?

If you don't see, then I have a perpetual motion machine to sell you.

Re:Why? (1)

0123456 (636235) | about a year ago | (#43531415)

Proof: if we could rely on a stock price increasing just before the dividend then we would bid up the price right now, well before the dividend.

And how do you plan to do that?

OK, you buy a bunch of shares today and push the pirce up. Then the price starts to fall as you stop buying. Now you have to keep buying more to keep the price high, and try to dump them all shortly after the dividend, when everyone else is.

In which alternate reality does this make any sense?

Re:Why? (2)

Tough Love (215404) | about a year ago | (#43531763)

What I described has a simple, two word name: efficient market. Say, did you ever read a finance textbook? Or try wikipedia/a. [wikipedia.org]

Re:Why? (1, Interesting)

Tough Love (215404) | about a year ago | (#43531421)

If a stock rises as the dividend date gets closer, purely because of the dividend then those new buyers are just gullible, and the everybody who failed to value the company accurately is just stupid. Proof: if we could rely on a stock price increasing just before the dividend then we would bid up the price right now, well before the dividend. And so the stock would not rise in advance of the dividend because it was already fully valued. See?

It is a mystery to me why somebody with mod points would feel offended by having basic financial facts explained to them.

Re:Why? (4, Insightful)

Alomex (148003) | about a year ago | (#43531575)

, purely because of the dividend then those new buyers are just gullible,

Nope. The dividend is the reward for holding the stock for a full quarter. Thus the stock price at the beginning of the quarter would be the amount that makes the dividend comparable to the interest rate the stock price would earn if it owned corporate debt.

However as the date of the dividend approaches the former owner wants a larger part of this reward because it held the stock for most of the quarter, while the new holder naturally expects less of it.

In the extreme, if I buy the stock a second before the dividend is issued I would get a hefty return for having done nothing unless the price rose.

Your proof is all wrong because it fails to consider the cost of holding the stock instead of say corporate debt.

Re:Why? (1, Insightful)

Tough Love (215404) | about a year ago | (#43531441)

Wow, this is weird. Apple spinmods modding down anybody who explains that dividends do not drive up a stock price, they do the opposite?

Once again (0)

Anonymous Coward | about a year ago | (#43530797)

Maybe they should bring something out worth a damn instead of spending all their time/money on buying back what used to be worth 5 times as much if not more. *facepalm* of the day.

AAPL After Hours (1)

Rick Richardson (87058) | about a year ago | (#43530801)

Current: $406.160.01%

Volume         High                       Low
6,049,276     $ 429.90 (17:02:34 PM)     $ 398.1597 (16:13:10 PM)

Re:AAPL After Hours (0)

Anonymous Coward | about a year ago | (#43530853)

I didn't see unusual motion because of this news, which seems kind of unexpected.

Re:AAPL After Hours (1)

Dunbal (464142) | about a year ago | (#43531813)

Because the people with real cash (banks and investment firms) have known about this for longer than you me or slashdot, and the average person isn't going to start trading a $400 stock (which means $40,000 as a minimum trade quantity thanks to 100 share lot sizes) after hours unless the company is going under or something.

what does this actually do? (0)

Anonymous Coward | about a year ago | (#43530813)

I know American companies dont normally pay dividends so you dont make any dosh until you sell but if the company buys back the shares to burn off its cash mountain who owns those shares?

Re:what does this actually do? (0)

PhamNguyen (2695929) | about a year ago | (#43530871)

They effectively disappear. Buy-backs and dividends are functionally equivalent.

Re:what does this actually do? (4, Informative)

hedwards (940851) | about a year ago | (#43530919)

No, they're not.

Dividends encourage investors to hold their shares for long periods of time by giving some income along the way. A buy back is something which boosts the price of the shares, but does nothing to generate a revenue stream for the investor. And if it doesn't inspire new investors to buy in, it can result in little or no benefit to the investor.

What's more, you can issue a dividend regardless of what the price of the stock is with respect to it's actual worth, whereas you shouldn't be buying back stock unless the shares are worth less than the management thinks they're worth.

Dividends themselves are generally something that only make sense when the firm doesn't have somewhere to invest the money themselves. It basically says to the investor that you're going to make more money investing the money elsewhere than we're going to derive by investing it ourselves. And frequently that means that the business can't expand any further for regulatory reasons.

Re:what does this actually do? (1)

istartedi (132515) | about a year ago | (#43531181)

Also, individual investors have to pay taxes on dividends. I'm not sure if corporations have to establish a cost basis for potential sale when they acquire their own shares. Not my problem. If the stock pays no dividends but goes up in price, I don't pay tax on the capital gains until I sell. If I never sell, I can leave the shares to my heirs who will get a new tax basis.

Disclaimer: IANAfinancial/tax advisor...

Re:what does this actually do? (0)

Anonymous Coward | about a year ago | (#43531257)

dividends benefit current stock holders.
share buybacks benefit stock holds and option holders.

Options holders own nothing (0)

Anonymous Coward | about a year ago | (#43531721)

An option to buy is nothing of value, and Apple is not owned by the Options holders, it has no duty to them.

"whereas you shouldn't be buying back stock unless the shares are worth less than the management thinks they're worth"
The market has passed its judgement, Cook is no Jobs, Cook does not know better than the market and he should not be using Apple money to create a false market in Apple shares.

Really, if he can't find productive use for it, he should hand it back to shareholders. Tax on dividends is no excuse, and its far better for them to have it than not have it. As it is, they have a falling shareprice, and that's largely because Cook can't seem to find new directions to spend money on. In effect the company is as big as he can successfully manage.

Man, you keep saying to yourself that a CEO is only a CEO and mostly they're just placeholders, but Jobs made such a huge difference to Apple. Cook I view as a placeholder till someone else comes along.

Re:what does this actually do? (0)

Anonymous Coward | about a year ago | (#43531731)

It basically says to the investor that you're going to make more money investing the money elsewhere than we're going to derive by investing it ourselves. And frequently that means that the business can't expand any further for regulatory reasons.

Or the company only has so many things to work on without over-reaching or over-expanding, so they think it's better to give investors some form of payback. These days, most companies have far, far too much faith in their ability to expand into areas outside of their bread and butter. Hell, many tech companies don't even have bread and butter and are still trying to expand. Then when they fold, investors have all of jack shit to show for their long-term faith in the company.

Subject: Dear Respected AAPL (-1)

Anonymous Coward | about a year ago | (#43530873)

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Re:what does this actually do? (2)

mosb1000 (710161) | about a year ago | (#43530887)

If the company repurchases its stock, the shares go away, thereby increasing the value of the remaining shares.

Re:what does this actually do? (-1)

Anonymous Coward | about a year ago | (#43531057)

thereby increasing the value of the remaining shares

No it doesn't, you moron.

Part of the value of the shares is the cash assets of the company; if they buy back shares, they use cash that should be roughly equivalent to the value of the share.

Now, if the shares were actually worth more than the current price, then yes, a buyback could conceivably increase the value of the remaining shares. But share value has absolutely nothing to do with scarcity.

Re:what does this actually do? (1)

mosb1000 (710161) | about a year ago | (#43531241)

The problem is you're assuming that the money in Apple's bank account is as valuable to an investor as the money in their own bank account, but this is not really the case.

Re:what does this actually do? (1)

Dunbal (464142) | about a year ago | (#43531829)

If the company repurchases its stock with company funds, the company funds go away thus decreasing the value of the remaining shares. Get it? The net effect is zero. What people like is that there are fewer shares around so that FUTURE gains per share are greater.

Apple stock = Apple products (0)

Anonymous Coward | about a year ago | (#43530821)

It's obvious what the idea is here. A single share in Apple is going to cost a fortune, the same shareholder value will be divided by significant less stock.

Re:Apple stock = Apple products (0)

mosb1000 (710161) | about a year ago | (#43530901)

$60 Billion is only a small fraction of the company's overall value.

Re:Apple stock = Apple products (2, Informative)

Anonymous Coward | about a year ago | (#43530997)

$60 Billion is only a small fraction of the company's overall value

The current market cap is $381B. $60B is an enormous buyback.

Re:Apple stock = Apple products (1)

mosb1000 (710161) | about a year ago | (#43531015)

nevertheless, 1/6 is a small fraction

Re:Apple stock = Apple products (1)

Anonymous Coward | about a year ago | (#43531209)

What a stupid comment. "small" is a relative term. In this case it isn't and it's very significant.

Just like a 10% GDP growth for a mature economy would be insanely large, yet it's only 1/10. "a small fraction" as you would say.

You're out of your depth. Stick to watching cartoon pony porn and playing WoW. Leave the real big boy talk to others.

Re:Apple stock = Apple products (1)

mosb1000 (710161) | about a year ago | (#43531601)

Ok, but this was the context:

A single share in Apple is going to cost a fortune, the same shareholder value will be divided by significant less stock.

Is a company buying back 1/6 of their stock going to result in shares costing "a fortune" or "significant less stock"? No. So you are the one who fails to understand the context, not me.

Re:Apple stock = Apple products (0)

Anonymous Coward | about a year ago | (#43531491)

you're an idiot and should not comment on topics you don't understand, 1/6 is NOT a small fraction, it is a massively significant portion of the stocks value, it is equal to approximately their profits for 2 years and represents a huge gamble in the value of their own stock. Even if they had said the buyback was half or a 3rd of that it would still be a massive portion of the companies value. If the profit margins slide further over the coming years it would mean that Apple just threw away several years of Ipad and Iphone sales and profit.

Re:Apple stock = Apple products (1)

ClintJCL (264898) | about a year ago | (#43531533)

as fractions go, I'm pretty sure 1/6th is smaller than 5/6ths of all fractions between 1/0th and 1/1th.

Re:Apple stock = Apple products (0)

Anonymous Coward | about a year ago | (#43531807)

1/0 doesn't actually have a value, so your comparison doesn't make sense. You probably meant between 0/6 and 6/6 (or 0/1 and 1/1).

Sounds like a good idea (1)

PhamNguyen (2695929) | about a year ago | (#43530899)

Companies exist to make money for their shareholders. Sometimes they run out of productive things to do with the money they have, so the most responsible thing to do is return it to shareholders. Apple's strategy is to make a lot of money now, not invest for some far future payoff.

Re:Sounds like a good idea (1)

ArcadeMan (2766669) | about a year ago | (#43531003)

If Apple's only goal was to make money, they'd sell things with a far higher profit margin, like sugared water.

I hope Tim Cook remembers what drove Steve Jobs when he approved products or threw them back to the drawing board.

Re:Sounds like a good idea (-1)

Anonymous Coward | about a year ago | (#43531223)

I hope Tim Cook remembers what drove Steve Jobs when he approved products or threw them back to the drawing board.

What, you mean power? It sure as hell wasn't money that got Steve out of bed day after day. His daily toiletpaper budget alone could have bought out any number of small nations.

No, his primary motivator was having the ability to shout, stomp, and belittle his employees with impunity on a daily basis. He was a colossal prick first, businessman second.

Re:Sounds like a good idea (1)

the computer guy nex (916959) | about a year ago | (#43531051)

Companies exist to make money for their shareholders. Sometimes they run out of productive things to do with the money they have, so the most responsible thing to do is return it to shareholders. Apple's strategy is to make a lot of money now, not invest for some far future payoff.

Well Apple was doing both. In the quarter they just reported there were massive increases in capital expenditures, looks like another product is around the corner.

Re:Sounds like a good idea (5, Insightful)

Anonymous Coward | about a year ago | (#43531185)

No. No they do not.
This is the biggest lie ever told to the American public, and anyone telling you this should never be trusted. (Yes. This is a large list.)

Companies exist to promote commerce, create useful goods, and provide a livelihood for their employees. Owners and stock holders are allowed (This is a revokable privilege, not a right) to make money to provide incentive to facilitate the above functions. Anything less is a criminal enterprise.

When we deviated so far in to the "making money" and "shareholder value" ideas is the day this country started to fall apart.

This is not an argument. This is advice. Ignore it at your own peril, America.

Re:Sounds like a good idea (0)

Anonymous Coward | about a year ago | (#43531553)

what a load of bullshit. Investors will not provide livelihoods and useful goods unless they are making a profit in return for the LOAN of their money in order to create said employment and goods. If the business cannot create a profit then said jobs and goods are taken away and the investor goes elsewhere, neither side as a right to anything, not the employee, nor society even if the goods are needed. The relationship is symbiotic, you can't have one without the other, the idea that investors are happy for you to risk their money for no benefit is ridiculous.

Re:Sounds like a good idea (0)

Anonymous Coward | about a year ago | (#43531587)

If you would start at the beginning, you'd see that we are talking about what should be done with some money that's NOT being used to do any of those nice things you mentioned.

In other words: Apple doesn't know what to do (0)

Anonymous Coward | about a year ago | (#43531007)

with the money. Instead of investing it in the future of the company, they return it to the investors. Looking good.

Arrogant (0)

Anonymous Coward | about a year ago | (#43531063)

So Apple will use their investor's money to buy out some of their investors instead of returning it. How arrogant. But why should Apple treat their investors any better than their customers...

This is a well understood good strategy. (1)

Camembert (2891457) | about a year ago | (#43531171)

It is in general a good idea for a company to buy back shares when they are low, especially if the company expects good business going forward. In a way, this plan makes clear that they are very confident in their upcoming new products.

In Soviet Russia (0)

Roachie (2180772) | about a year ago | (#43531329)

apple purchases you!

R.I.P. (0)

Anonymous Coward | about a year ago | (#43531371)

It's my perception Apple used to be a beacon of inovation and design, now it's dumping it's warchest trying to get a short term stock bump to help insiders sell.

This is worse than Yahoo messages (5, Insightful)

m.dillon (147925) | about a year ago | (#43531449)

Stick to your roots guys, this isn't a stock forum and 99% of the people here clearly don't know one blessed thing about investing, how companies work, or even what these big numbers actually mean.

Actually its worse then that, but I'm being politic.

-Matt

That's SIXTY BILLION DOLLARS (1)

Anonymous Coward | about a year ago | (#43531485)

You know what Apple could have done in the real world with that kind of money? Imagine if they decided to use it on philanthropy.

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