Apple Goes Native...

[GRG55]

Stock buyback announcement as it is hitting new all time highs? Long live the FIRE economy.

No other comment necessary...

Apple to initiate dividend, share buyback

Mon Mar 19, 2012 8:49am EDT

(Reuters) - Apple Inc said Monday it will initiate a regular dividend of $2.65 a quarter from July and will buy back up to $10 billion of its own shares starting in fiscal year 2013.

The share buyback program is expected to be executed over three years with the primary objective of offsetting the impact of employee stock options and equity grants.

[jpatter666]

Re: Apple Goes Native...

Stock buyback announcement as it is hitting new all time highs? Long live the FIRE economy.

No other comment necessary...

Apple to initiate dividend, share buyback

Mon Mar 19, 2012 8:49am EDT

(Reuters) - Apple Inc said Monday it will initiate a regular dividend of $2.65 a quarter from July and will buy back up to $10 billion of its own shares starting in fiscal year 2013.

The share buyback program is expected to be executed over three years with the primary objective of offsetting the impact of employee stock options and equity grants.

Yeah, I saw that and I thought -- if you've got APPL, get out now. With Steve gone, it's just another company now.

Next thing you know, they'll start a finance arm -- so you can afford to buy your next iOwe product.....

[GRG55]

Re: Apple Goes Native...

Yeah, I saw that and I thought -- if you've got APPL, get out now. With Steve gone, it's just another company now.

Next thing you know, they'll start a finance arm -- so you can afford to buy your next iOwe product.....

It's like watching a mugging in progress.

Next thing you know, the perpetrators are in the back alley cuttin' up the cash...

[Chomsky]

Re: Apple Goes Native...

Stock buyback announcement as it is hitting new all time highs? Long live the FIRE economy.

No other comment necessary...

Apple to initiate dividend, share buyback

Mon Mar 19, 2012 8:49am EDT

(Reuters) - Apple Inc said Monday it will initiate a regular dividend of $2.65 a quarter from July and will buy back up to $10 billion of its own shares starting in fiscal year 2013.

The share buyback program is expected to be executed over three years with the primary objective of offsetting the impact of employee stock options and equity grants.

Sorry, I might be a little dense this morning. So Apple is pledging to buy back its own shares, partially in order to offset employee stock options. Is that because the exercising of those options is a net negative for the stock price?

[GRG55]

Re: Apple Goes Native...

Sorry, I might be a little dense this morning. So Apple is pledging to buy back its own shares, partially in order to offset employee stock options. Is that because the exercising of those options is a net negative for the stock price?

Sort of. The buyback is because the issuing of those options and stock grants to employees is dilutive to all the other shareholders.

What Apple has essentially done is tell all the non-employee stockholders that it is doing them a "big favour" by taking up to $10 B of cash reserves and transferring it from the corporate balance sheet into the pockets of the employees that are given those options and stock grants.

A management team never, ever creates shareholder value by announcing a share buyback as the stock is hitting all time record highs...

[c1ue]

Re: Apple Goes Native...

A management team never, ever creates shareholder value by announcing a share buyback as the stock is hitting all time record highs...

+1

What a share buyback does in this situation is simply ensure that the insiders selling out don't "signal" that the free ride is over.

IMO the rank and file employees don't matter - it is more about selling by big institutional and top 100 executives. The evidence will be in recent and ongoing share/option grants; I haven't been following Apple grants recently so don't know if there has been unusual activity there.

Buybacks are nice because then there is guaranteed 'demand' for when an institution or large holding insider starts dumping 5 and 6 digit numbers of shares on the market.

It may also a sign that there is less demand on the institutional side because normally a large holding insider or institution looks to find and negotiate a sale of a large chunk 'off ticker' first.