Advertisement: MacMall Special: Adobe InDesign CS5 for Mac (65062470) only $694.99 + FREE Shipping
“Apple is currently trading at an elevated market capitalization that rivals the likes of Exxon Mobil (XOM), and all indications point to Apple far surpassing Exxon to become the largest company in the United States in terms of market capitalization sometime in 2011,” Zaky writes. “For the market to have full confidence in Apple’s market cap, Apple will have to show that though its net income isn’t anywhere close to surpassing Exxon’s in the immediate future, its extraordinary cash position justifies a very large portion of its market cap.”
Zaky writes, “Shareholders will derive a larger benefit from headlines that read ‘Apple exceeds $100 billion in cash’ than headlines that read ‘Apple returns a few dollars to its shareholders.’ Once the fact that Apple surpasses $100 billion in cash spreads across the financial industry, no one will question whether Apple should hold the #1 market cap.”
Read more in the full article – recommended – here.
MacDailyNews Take: We’re not sure what’s motivating Sacconaghi, but if it’s to continue looking like a goofball, he’s doing a great job.
If Apple dosen’t use it soon the “in the name of government” crooks are gonna take it.
Don’t you see why all the cash?
” width=”19″ height=”19″ alt=”smile” style=”border:0;” />
Steve is collecting it so Apple can buy Microsoft in cash
Sacowhathamacallit is a shit disturbing rabblerouser.
That’s his motivation.
My advice to Toni, STFU.
The second $50 billion will go so much faster than the first $50 billion.
Unless of course Apple decides to buy up the automotive, television and airline industries before they hit that magic number.
At some point, Apple will be able to pay cash for a country and move from high taxed California to Apple land. It would be the world’s focal point of all thing IT. Apple would make that up in only a short few years without the pressure of State and Federal Taxes.
Or maybe they could buy one of the states and take it private. Pulling it out from under the FED and Washington DC.
Or …
Sacconaghi has been wrong so often you can make investment decisions by doing the opposite of what he recommends, and is proof positive that Wall Street doesn’t know any more than the average Joe in the America.
@ Jersey
That’s what you would do. Apple is part of American and Californian society, and happily pays its dues to be just that.
Apple could buy a carrier.
Zaky’s article is poorly written. If you read all but the last paragraph, it sounds like Zaky believes passing XOM in market cap is the goal of Apple, or of specific interest in of itself to shareholders. It’s not.
Then he adds, “Instead, what Apple should do is either offer a share buy-back program to reduce its market cap, or hold off on offering a dividend until it surpasses $100 billion in cash. This much is obvious.”
This isn’t that different from Toni. Specifically what Toni is asking for is *guidance* on what Apple’s intentions are with the cash going forward.
Zaky conveniently leaves out the fact the analysts routinely factor in dividends and so do investors when they’re looking at the return.
At $100 billion, about 30% of your investment in Apple will be in cash that’s getting a .76% yield.
If you want to invest in cash, put your money in the bank. I’d rather invest in Apple’s business, but management is making that increasingly prohibitive.
Again, nobody is talking about Apple cashing-out, or not having money for a rainy day, or money for purchasing opportunities, but rather having cash that’s at least somewhat near the ballpark of what’s normal. Right now it’s totally out of whack, and skyrocketing further in that direction with no discussion of what will be done.
IMHO, Tony just wants to buy a bunch of Apple shares…… get Apple to declare a dividend ( $$ per share) and then sell the shares back as fast as he can. Instant cash.
Greed…. pure and simple.
Just a thought,
en
I think Zaky needs to get an MBA instead of posting stuff from his mother’s basement while snaking on potato crisps.
Zaky is right.
Actually xom revenues are bloated. Mostly by their gross sales in Europe, which include taxes that are more than 50 percent of the sales price. Also, the gouging done at the ice and nymex casinos create enormous profits from their upstream business. If and when the gouging stops, revenues and profits would drop big time.
Apple needs to buy Clearwire (CLWR) which would give Apple its own wireless 4G worldwide network.
If they issued dividends we’d all buy more Apple stock. The stock would be worth less because of the reduced cash reserves so we’d end up with the same place.
@macslut
Apple doesn’t discuss plans with public. Being the only company that innovates.
As much as I would like a dividend or a split, I don’t see what motivation AAPL has to do so. Splits and dividends are to encourage people to buy the stock to raise capitol or raise stock value. AAPL doesn’t need to raise capitol, and the stock value will remain great due to their continuing market capitalization rise.
So what does AAPL gain by doing this?
Apple makes plenty of money from it’s cash. I think they know what they are doing. Analyst make these statements because they want to manipulate the market.
Scrachmycrotchi is a buffoon of the highest order. He is so far off base most times, my blessed Grandmother could pick him off!.
A split of 2:1 or 3:1 is way better than a dividend, Apple has at least another five to seven years of strong growth ahead, a split a a rise back to 225 a share in a year or two is way better than a dividend.