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Apple increases dividend by 15%, poised to embark on large stock-repurchasing plan
In conjunction with its earnings report for Q2 2013, Apple issued a press release announcing some major plans for its ever-growing stockpile of cash. In March 2012, Apple announced that the company would be instituting a $2.65/share dividend on a quarterly basis with Apple's first dividend payment to investors going out in August of last year. Now, about one year later, Apple announced its plan to increase its quarterly dividend to $3.05 per share. The next dividend payout to investors is scheduled for May 16, 2013. What's more, Apple also announced a massive increase to its stock-repurchasing plan. As part of this program, the Board has increased its share repurchase authorization to $60 billion from the $10 billion level announced last year. This is the largest single share repurchase authorization in history and is expected to be executed by the end of calendar 2015. Apple also expects to utilize about $1 billion annually to net-share-settle vesting restricted stock units. When Apple first announced its dividend and stock repurchasing plan last year, it revealed that both initiatives would eat up about $45 billion from Apple's cash reserves. Under Apple's more aggressive dividend and stock repurchasing plan, Apple notes that the company will now be using $100 billion of its cash reserves to return money to shareholders and repurchase outstanding shares. The company expects to utilize a total of $100 billion of cash under the expanded program by the end of calendar 2015. This represents a $55 billion increase to the program announced last year and translates to an average rate of $30 billion per year from the time of the first dividend payment in August 2012 through December 2015. For a company that was long content to sit on its growing cash hoard under the helm of Steve Jobs, today's announcement represents a monumental shift in Apple's use of cash. Regarding Apple's new use of cash, Apple CEO Tim Cook explained in a press release, "We are very fortunate to be in a position to more than double the size of the capital return program we announced last year. We believe so strongly that repurchasing our shares represents an attractive use of our capital that we have dedicated the vast majority of the increase in our capital return program to share repurchases." Thus far, Wall Street seems to be pleased both with Apple's earnings report and news of its expanded cash program. In after hours trading, shares of Apple are up nearly 5 percent, trading up nearly 20 points.
AAPL drops below $400 briefly; Cirrus Logic inventory numbers blamed
Apple Inc. (AAPL) stock fell to its lowest price since December 2011 today following a report from Cirrus Logic, a producer of chips used in the iPhone and iPad, that it was dealing with an inventory surplus. Cirrus Logic said one of its customers is moving to a newer component causing the slowdown, The Associated Press reports. It did not specify which customer made the switch, but Apple is reportedly its biggest customer. Investors took this as a sign that iPhone and iPad sales might have fallen short of expectations. Apple's prices fell about 6 percent, and the market closed with Apple stock at $402.80, down $23.44. At one point, the stock had slipped below $400. Apple stocks have fluctuated in the past few months, hitting an all-time record of above $700 in September due to pent-up demand for the iPhone 5. It is worth noting T-Mobile just began selling the iPhone 5 on April 12, to reportedly strong sales. Apple is scheduled to announce Q2 2013 earnings on Tuesday.
Trader pleads guilty to making unauthorized purchase of nearly $1 billion in Apple shares
The FBI reports that a trader who last year made an unauthorized purchase of nearly US$1 billion worth of Apple stock has pled guilty to wire fraud, securities fraud and conspiracy. On October 25, 2012 -- the same day Apple posted its Q3 2012 earnings -- David Miller of Rochdale Securities made a number of unauthorized purchases of Apple shares which ultimately led to the demise of the financial services firm he worked for. The aim of Miller's action was to make a lot of money very quickly by purchasing large quantities of Apple shares and selling them in a post-earnings surge. So starting at around 9:30 AM on October 25, a co-conspirator of Miller's put in an order for 125,000 shares of Apple stock. Throughout the course of the day, Miller continued to snatch up shares of Apple in quantities of 125,000. By the end of the trading day, Miller had acquired approximately 1,623,375 shares of Apple. Apple at the time was trading in the low $600 range and Miller's unauthorized shares were worth close to $1 billion. Later that day, Apple posted solid earnings, but as is typically the case after an earnings report, shares of Apple went down over the next few days. When the higher ups at Rochdale Securities confronted Miller about his large stock purchase, he claimed he had accidentally entered in a legitimate customer order for 125,000 shares of Apple multiple times. Rochdale Securities was subsequently forced to sell its position in Apple and endured a loss of nearly $5.3 million. Unfortunately, the firm, based in Hartford, Conn., was unable to recover from the loss. Just one month later, Rochdale Securities let go of its staff and ceased to function as an operating entity. It's worth noting that Miller's unauthorized purchase of Apple shares wasn't the only crime he engaged in. The FBI adds: While he was executing the scheme at Rochdale, Miller also defrauded another broker-dealer into taking on a significant short position in Apple stock. Through a series of misrepresentations made over the course of several weeks, Miller convinced the broker-dealer to sell 500,000 shares of Apple stock, falsely claiming that he was trading for the account of a company, which he had no relationship with and for which he was not authorized to trade. Miller engaged in this part of the scheme to hedge against the large purchase of Apple stock he was executing at Rochdale. Miller will be sentenced on July 8, 2013. The renegade stock trader faces up to 25 years in prison but may only serve five to eight years under terms of a plea agreement. In the meantime, he is free on $300,000 bond.
AAPL takes a hit despite iPhone 4S news (Updated)
Apple's share price has dropped dramatically after today's announcement of the iPhone 4S. At 3:07 PM EDT, AAPL was down over $16 per share to $358.51, although it could recover before today's market close. While this doesn't look good for Wall Street's enthusiasm for the new device, the stock drop is actually quite normal for the day of an Apple announcement. We've seen similar results after announcements of most new Apple devices, with the stock usually recovering or rising the next day. The stock price for new US iPhone carrier Sprint doesn't seem to be reacting much in one way or another to the announcement. At press time, the company's stock was selling at $2.68 a share, down $0.06 for the day. Shares in Verizon and AT&T were relatively steady as well. Of course, most of the responsibility for the lackluster stock price for Apple could be tied to the world economic news today. Fed Chairman Ben Bernanke's comment that "The economic recovery is close to faltering" has resulted in an overall decline on the markets, with the Dow-Jones Industrial Average down 162, S&P 500 down 12, and NASDAQ down 17 at press time. Update: AAPL closed today at $372.50, only down $2.10 (-0.56 percent). The DJIA, NASDAQ, and S&P 500 all finished the day up. It's amazing what can happen with the market in only an hour... Turns out that the "hit" was more of a "hiccup."
Apple stock opens about 5% down, but most analysts remain calm
At the opening bell this morning, AAPL was down 5%, erasing about US$15 billion dollars of the company's market value. As of this writing, Apple is trading at $336. It's not time to get out on the ledges, however, as many experts think an expected blow-out earnings call later today could erase the losses. Of course, the stock value picture is always most interesting over the long run, and will also be impacted by how long Steve Jobs is out on medical leave. Many investors are sitting on the sidelines waiting to see the results of the earnings call, and some are predicting Apple will announce a 50% increase in quarterly sales this afternoon. Other analysts expect lower earnings and revenue. Apple made the announcement about the medical leave yesterday on a US holiday when American markets were closed. When Jobs announced his previous leave, the stock lost about 8% in two days. Last Friday, Apple stock was at a 52 week high of $348 per share.
AAPL could hit $410 according to R.W. Baird analyst
If only this blogger had held onto that Apple stock that was bought for about $8 while dabbling in the market in the late-1990s. Instead the profits from selling it at $27 a share were put into such wise investments as Webvan. The only good thing about my dot com bubble investing period is that only a small chunk of money was set aside to play with and no more was added. On the other hand if I had just had more patience and stayed in Apple, I'd have a very nice chunk of change with it now trading at over $317 per share and likely to go much higher. According to a recent Associated Press article, William V. Power, an analyst with R.W. Baird is projecting that AAPL shares will be trading at as much as $410 before long and he is not alone. Numerous analysts have projected $400+ for Apple and the average of 38 different projections is $370.50. The key to that continued growth according to Power is the iPhone which currently only commands about three percent of global mobile phone sales. As smartphones grab an ever larger stake of the handset market, Apple and its prime competitors, Android and Windows Phone 7 are all likely to see big gains in the next few years and that will certainly help Apple's bottom line and stock price.
It's a Merry Christmas for AAPL shareholders, stock at all-time high
On December 14th, I posted an opinion piece sharing my thoughts that AAPL stock would hit $300 a share in a year (for which I received quite a lot of critical feedback). Two days later, on December 16th, Morgan Stanley's Katy Huberty issued a report stating she believes there is a 25% chance that AAPL will be between $325 and $435 in the next twelve months (she also believes it could fall to $150 if Google's Android takes off and Apple drops the ball). Huberty based her bullish outlook on the scenario that iPhone sales are on pace to capture 10-15% of the handset market by 2012 – and this doesn't even include soaring Mac sales or the impending iSlate. Well, the stock isn't at $325 yet, but on December 24th, AAPL did close at an all-time high of $209.04. Not bad considering on December 8th, the stock was down almost 8% on its previous high of $208 on November 16th. Christmas Eve's 3.4% one-day gain was driven primarily by the news that Apple has booked the Yerba Buena Center for the Arts for an event on January 26th. So, where does the stock go from here? Traditionally, there is an early-January slide for AAPL that coincides with the "buy on rumor, sell on news" MacWorld Expo event, but since MacWorld is going to be Apple-free from now on, who knows if that will happen this year. And even if the early January slide hits AAPL, the company has so much going for it besides the rumored iSlate, I'm beginning to think my $300 target is rather conservative. But that's the future. For now the $209 share price is a nice Christmas gift. Disclaimer: This author owns shares in AAPL. Opinions in this post are those of the author only and should not be considered as investment advice.
Apple shares slide following keynote
Here's a shocker -- Apple shares slid 0.7 percent (as of this writing) after Phil Schiller concluded the company's last official keyonte address at Macworld Expo. Robert Francello, head of equity trading for Apex Capital hedge fund in San Francisco, blamed "...no true blockbusters" for the market's reaction.With that, we have a large part of why Apple has abandoned the show. Ten or twelve years ago, Apple needed such a high-profile event to get its products noticed by as many people as possible. Additionally, they'd pack as much into those precious 90 minutes as they could, while they had everyone's attention.Today, that's not the case. Phil Schiller noted that 3.4 million customers visit their retail stores per week, worldwide. The "lesser" press events, like the annual September iPod announcement, attract all the attention Apple needs. These are much less expensive to produce and allow Apple to release products when they're ready, not when the calendar reads "January." Therefore, there's no cache of goodies waiting for the Moscone Center, which always disappoints Wall Street and adversely affects Apple's stock price.Sure, it's sad to see Apple go, but the "why" is clear.[Via MacDailyNews]
Apple announces date for Q4 conference call
Earlier this week, Apple announced that their fourth quarter financial conference call will take place on October 21st. The live audio stream will begin at 2PM Pacific time.We'll be liveblogging the call, so check back on the 21st for up-to-the-second information and analysis. Apple's stock took a significant dive last month, as did the rest of the market. Still, Apple's overall market share continues to be strong, and retail stores continue to open across the globe. It will be an interesting report.[Via MacNN]
Apple stock price dips in January rollercoaster
In our last-of-2007 podcast, our resident AAPL-watcher Mike Rose pointed out Apple's exceptional fiscal performance as one of the most important stories of the year. Quite rightly so: Apple had, by all accounts, a phenomenal year. There's even predictions from analysts of AAPL reaching the frankly dizzying heights of $300 - $600 in the next 18 months - we'll see how those fare, folks.With the financial analysts talking about Apple stock's seemingly rosy future, it's perhaps surprising news that AAPL has lost 7.5% (dropping nearly $15) just today. That's about $12 billion knocked off Apple's market cap. With Macworld around the corner, Apple stock is the subject of much speculation already - both for us covering the 'Keynote Index Fund' here at TUAW and over at Wired (to mention but a few). Undoubtedly, there's folks looking to partake in a little daytrading or trading over the duration of the entire Macworld week. With that in mind, might the Feds and SEC be more than interested in the interaction between the keynote (including its audience, one might fathom) and the effect it has on Wall Street?For ongoing coverage of AAPL, check out our colleagues' posts at Blogging Stocks:AAPL.Disclaimer: The points mentioned above come from a personal, and strictly non-professional, opinion, and should not be considered investment advice. For advice on stocks and investments, always seek advice from a regulated financial advice professional.Update: We ought to add that the market did indeed drop as a whole. However, the drop in Apple's stock was disproportionate to the down day.
Silly Sunday Survey: Who would replace Steve Jobs?
Douglas McIntyre over at Blogging Stocks posed an interesting question the other day, in light of the current issues surrounding Apple's option back-dating. If it were discovered that Steve Jobs played a key role in the option mishap and he was forced to resign as CEO, who would/should be his replacement?Here are the candidates McIntyre suggests as possibilities: Phil Schiller -- He is the long-time head of global product marketing. He has been with the company since 1997 and has been critical in most product launches. (Update: Bob points out in the comments below that Phil started at Apple in 1987, then left for a few years during Spindler and Amelio's tenure, then returned in 1997) Tim Cook -- The company's COO. He had a long career at IBM. He also heads the Mac division. Tony Fadell -- One of the fathers of the iPod; he has an engineering background. He is a former executive at Philips Electronics. William Campbell -- One of Apple's leading directors. He has run a large public software company, Intuit. Jerome York -- Although he is over 70, York has experience operating troubled companies. He was CFO of IBM and a member of that company's board. He is also on the GM board. (Update: Alex alerts us in the comments that as of last week York is no longer on the GM Board) Jim Allchin -- Head of platforms and services at Microsoft. He intends to retire with the the launch of Vista. Allchin has an engineering background. Sue Decker -- The highly regarded CFO of Yahoo! She has a Wall St. background and now runs several key divisions at Yahoo! John Thompson -- The highly-regarded CEO of Symantec, has a background in running a large software company and is well liked on Wall Street. Perhaps some of you would like to weigh in?
Apple beats Q2 estimates
Yesterday was Apple's Q2 financial conference call, and it's safe to say things went well. Apple generated $410 million (47 cents per share) in the 2nd quarter of 2006, up from $290 million (34 cents a share) as this time last year. Wall Street's projection was 43 cents per share. iPod sales continued to do well, and Mac sales rose 4%. I'm really interested to see the same numbers a year from now, once the full line of Macs are Intel-based and Leopard has been released.
WWE champ JBL: Apple stock a buy
Here's an article we didn't expect to find this morning. WWE superstar JBL writes about the stock market for The Street. No, seriously. In last Saturday's article, he had some nice things to say about Apple (and AAPL). Having just read iCon, the unauthorized bio of Steve Jobs, JBL stated his admiration for Apple's leader, and said this about Apple stock:"Apple is a dream company. No debt, and over $10 per share in cash. Add to that the fact it is still a growth story and you have a stock that is cheap."If JBL tells you to buy a stock, buy it. You don't want a steel chair to the back of the head, do you?
Boot Camp boosts Apple's stock 8%
It seems that the geeks like you and me aren't the only ones excited about Apple's release of Boot Camp. This morning, Wall Street demonstrated a bit of support, too, as Apple stock rose 8% in early trading. True, it's just the beginning of the day, but we'll see what happens. I'm going to guess that, when this is built into the OS, it means increased Mac sales. This year's World Wide Developer's Conference should be a good one.
Apple's stock looks down, loses balance
Well, it was bound to happen: Apple's stock, after years of joyously ascending in a fashion worthy of the New Testament, has finally reacquainted itself with the wonders of gravity and the venerable cliché, "What goes up must come down." The share price fell over 5% today, closing at $67.30 -- a two-month low for the company whose stock was kicked out of Willy Wonka's factory for sneaking a sip -- or, as the situation would suggest, a chug -- of the infamous Fizzy Lifting Drink. Sources cite the recent surge of iPod/iTunes-related lawsuits, a fear that Intel Mac adoption would be slower than expected, and the belief that Apple's market value was just a teensy bit inflated as the reasons for the drop. But some analysts -- like our favorite Gene Munster -- say Wall Street's worries are unfounded, and believe Apple will keep its years-long momentum on track.Personally, I just see this as an excellent buying opportunity. Apple will only sell more Macs and more iPods, despite what they say about expectations -- and aiming low but hitting high is always better than aiming high and shooting your foot.[via MacObserver]
Apple stock leaps 6% following keynote
With Steve's voice still echoing from the stage at the Moscone center, Apple's stock climbed 6% to $81.89 by the early part of this afternoon. It would appear that Mac fans weren't the only ones impressed buy the new hardware and successful holiday shopping season. I'd say things are going well in Cupertino.[Via Macenstein]
