• Apple Announces Quarterly Dividend and Plans to Buy Back Shares




    This morning Apple announced plans to buy back some of the company’s shares and start paying a dividend to shareholders.

    Apple will begin paying a quarterly dividend pf $2.65 per share starting in July. The dividend is equal to a yield of 1.8% measured against the stock’s closing price. Not a massive number, but for those holding a substantial number of Apple shares the payout could be quite sweet. The dividend will cost Apple around $10 billion this year, but the company generated close to $16 billion in cash during 2012’s first fiscal quarter and Stern Agee and Leach inc. analyst Shaw Wu predicts Apple will generate $75 billion in cash total during 2012.

    Also, Apple announced plans to buy back nearly $10 billion worth of the company’s shares. The buy backs will take place over a three-year period beginning September 30th.

    “We have used some of our cash to make great investments in our business through increased research and development, acquisitions, new retail store openings, strategic prepayments and capital expenditures in our supply chain, and building out our infrastructure...

    Even with these investments, we can maintain a war chest for strategic opportunities and have plenty of cash to run our business. So we are going to initiate a dividend and share repurchase programme.” — Tim Cook
    Cook is right, minus the $10 billion dished out via the dividend payments this year, and the buy backs (spaced out over 3 years remember) Apple will still generate upwards of $60 billion in cash this year. Exactly how much of that cash will actually find its way into Apple's cash hoard is up to the analysts to figure out. Still, it must be nice to make more money than you know what to do with. Or make so much, that you know what to do with it, and you still end up with billions left over.

    Source: Bloomberg
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