Linked by Thom Holwerda on Tue 23rd Apr 2013 22:35 UTC
Apple "Apple just posted its hotly-anticipated Q2 2013 earnings, and the company posted a profit of $9.5b on revenues of $43.6b, compared to $11.6b in profit on $39.2b in revenue this quarter last year and $13.1b in profit on $54.5b in revenue last quarter. That's right in line with the company's guidance from last quarter. Most importantly, iPhone sales are fairly flat year-over-year. Apple sold 37.04 million in Q2 2013 versus last year's 35.1 million, a modest growth of seven percent. iPad sales for the quarter were 19.5 million, up a massive 65 percent from last year's 11.8 million, but the average selling price (ASP) dropped fairly steeply year-over-year, likely due to the introduction of the cheaper iPad mini."
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RE: apple stock purchases
by galvanash on Wed 24th Apr 2013 23:37 UTC in reply to "apple stock purchases"
Member since:

most major corporations do buy back lots of shares. IBM has been doing it for years. It keeps the share price high but can provide a better ROI than just dividends.

It also does a number of other things... It demonstrates confidence from the board in the company's ability to grow relative to their current stock price. It is in effect saying "we are betting 60 billion dollars of cash from our own pockets on our ability to make our stock price go up from where it is now".

Also, it is very attractive to smaller short term investors who will see it as a quick win and will happily trade some stock for $$$. Apple can stockpile the repurchases and reissue later when the stock price is higher, making money along the way.

Lastly, it helps maintain earnings per share - the more stock they sell the more eps drops...

All in all I think Apple wants to make itself more attractive to fund managers, and to do that they need to pay dividends and demonstrate some intent to stabilize.

They don't want flighty investors, and to make yourself attractive to long term money you have to have a long term plan.

Tim Cook thinks long. Steve Jobs didn't.

Edited 2013-04-24 23:38 UTC

Reply Parent Score: 3

RE[2]: apple stock purchases
by unclefester on Fri 26th Apr 2013 06:20 in reply to "RE: apple stock purchases"
unclefester Member since:

The real purpose of most buybacks is to artificially raise the stock valuation by reducing the total number of shares. This in turn increases the bonuses of senior executives. It is legal but totally unethical.

Reply Parent Score: 2