“Wall Street purists would say it is,” Fortt reports. “The argument goes something like this: Cash isn’t for show. It’s for investors. Companies have an obligation to either use it for growth drivers like acquisitions and equipment, or give it back to the shareholders.”
“Several investors quizzed Jobs about Apple’s ‘war chest’ at last month’s shareholder meeting, forcing him to defend his Scrooge-like ways,” Fortt reports. “Their concern is understandable. But I still say Steve should just ignore the noise and continue doing his thing with that pile of money.”
Why?
• Because it’s working
• Security
• Competition
• Access
• Real Estate
Fortt writes, “Without dividends or buybacks [AAPL] stock is worth about 10 times what it was worth a decade ago. That kind of performance earns you the benefit of the doubt.”
Full article here.