“Star hedge fund manager David Einhorn has a new product that he wants Apple Inc. to offer: the iPref,” Jennifer Ablan and Poornima Gupta report for Reuters.
“In an unusual hour-long public conference call on Thursday, Einhorn, who has filed a lawsuit against Apple as part of an effort to get the iPhone and iPad maker to distribute more of its $137 billion cash pile, detailed the merits of distributing perpetual preferred stock to reward investors and boost a share price that he says is undervalued,” Ablan and Gupta report. “‘This is not complicated, it’s merely unfamiliar,’ Einhorn said about his perpetual preferred stock idea. ‘Here’s the product that Apple doesn’t yet know it needs,’ he said, a riff on the mantra of Apple co-founder Steve Jobs that consumers don’t know what they want.”
Ablan and Gupta report, “Einhorn said Apple should use $47 billion in cash to issue preferred stock with a quarterly dividend of 50 cents in perpetuity. The stock would be in high demand, he said, because “savers across the country” are in desperate need of yield. ‘It has a base value of $50 and pays a dividend of $2 per year,’ he said. ‘Apple can redeem them for face value, but shareholders should not anticipate getting the face value. They should expect to receive 50 cents per quarter, every quarter, forever.'”
Read more in the full article here.
MacDailyNews Take: Forever is an awfully long time.
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