“Apple has nearly $100 billion in cash just sitting on its balance sheet, earning nothing more than a market rate of return,” Chris Ciaccia reports for CNBC. “As the cash hoard grows ever larger, shareholders have grown increasingly more vocal about getting hold of it.”
Ciaccia writes, “This poses the question: Do Apple shareholders have a legal right to the cash, and could they sue Apple to get it?”
“Even though there’s growing pressure for Apple to start paying a dividend again, the board does not have an obligation to pay, despite investors’ cries for something to be done,” Ciaccia reports. “Corporations are not charities, say lawyers, and are designed to earn a profit, which they can’t do effectively if shareholders are demanding financial capital back.”
Much more in the full article here.
It may be possible, but I hope not. I want that cash in the hands of the wizards who have created the most magical and successful companies in my lifetime and possibly all of human history, not in the hands of corrupt and incompetent economy and job destroying Wall Street crooks.
Well said. Although I don’t see how stock holders have any right to force a dividend.
No, I want that cash in my hands.
Think about it rationally. If Apple pays a dividend at the rate AT&T does then 100 shares of stock would pay enough dividend in a little over 7 years to buy another 100 shares. Reinvest the dividend, hold the stock for 30 years, and boom you’ve got a very tidy nest egg of 1,600 shares when it comes time to retire.
A Mac convert since 2001 and a shareholder since 2005, I have to agree with AAPL’s attorneys on this one. Let the company run its business as it sees fit.
Agreed!
Apple did not get to its current standard with revenue and product catelog by listening to outside sources. If they did, they wouldn’t have the perceived seperation from the industry. If you don’t like the philosophy of Apple’s culture, buy another stock, phone or computer.
Chris Ciaccia -hit whore!
No. Let’s NOT sue apple for something this stupid.
I’ve had Apple for 17 years now and I have never asked for a dividend. Besides the big name funds, who’s asking? I’d be interested to see who asks during next Thursday’s sharer holder meeting.
Pension funds like CalPers.
I’d say if you borrow, be able to give back and not to invest large amount of profit in a luxury building-shops like in Paris and Schanghai!
I am a stockholder. Any stockholder who has held the stock for any period of time would be a complete idiot to sue. The company management has shown incredible strategic brilliance in competing and winning in their market space. The cash is a part of the winning formula. I trust the management to make the right decision on when and if to pay a dividend. And there are issues that have to with tax implications on the repatriation of overseas profits which would significantly reduce the $100 billion. Until our Federal Government decides to have an intelligent tax policy, with a planning window longer than about 6 months, and one that stops punishing profitable enterprises, I would encourage Apple to keep the money out of the reach of the Senate and the President who could go through the $100 billion in about a day and not break a sweat.
If there’s any challenge here to Apple’s position, it will come from major shareholders such as hedge funds, investment firms, etc.
I don’t believe that it is the individual shareholders demanding this. I believe that it is the large, institutional holders clamouring. And I don’t really believe that the large, institutional holders have real, individual share holds’ interests at heart. They just want quick payback.
they could care less if they completely destroy Apple in the process if it means they look good on their balance sheets at the end of the quarter. I can’t think of a nicer group of crooks that I would love to see behind bars saying hi to bubba.
No.
Chris ‘Choke-the-chicken’ asks: “Do Apple shareholders have a legal right to the cash, and could they sue Apple to get it?”
Translation: ‘Apple has a lot of money and we want some of it.’
Answer: No, no and hell no.
There are two kinds of publicly traded companies (stocks): those that pay dividends and those that do NOT.
Apple stock does *not* pay dividends.
If people want dividends, then they should buy stock in another company that pays dividends.
Chris ‘Chicken-choker’ has the mindset of a moocher & looter and would rape & pillage whatever he could get his hands on.
Leave Apple alone, you fraqin’ opportunist.
Get the hell over the ‘dividend’ issue.
CNBC needs to fraq off…
I am tired of these greedy bastards asking. Really!? SELL IT if you want a payout! It is that simple! Stop bitching seriously.
This is how hedge funds attack and try to take over companies and instigate shareholder revolt.
Private investors normally show their confidence in the company and all it’s initiatives by investing, they buy into the company’s products and have full confidence in the management team that brought the company to it’s current standing. If they feel they no longer have that confidence they should sell their investments/ shares.
The thought of suing a company one is invested in, if not as a result of extreme bad faith or dishonesty is purely motivated by predatory intent or greed.
If you don’t like Apple, don’t buy into it, if you do , trust and have faith in it’s management strategies, workforce and products. Don’t be hostile to the only company that trully cares about excellence and it’s users which over the long term will deliver shareholders true value and great profit.
All Apple shareholders have probably recently received hostile proxy bids from funds trying to con votes that are predatory and anti Apple in design, under the guise of selfish entitlement theories – tell ’em to fuck off. Stand behind Apple if you are truly an investor and want the best products money can buy and the unrivaled user experience you enjoy from Apple products and software to continue.
A really accurate and perceptive comment. Congratulations.
Apple shareholders should not have to exit and sell their interest to get their return. in fact, failure to give the shareholders a fair return has limted the value of the stock. i have a major portion of my portfolio in AAPL. i do vote and voted against the entire board and was for the amendment that shareholders have a say. Frankly the agreed is that of Apple, they pay themselves handsomely but have not paid a dime to shareholders since 1995. It was different when Jobs was at the helm , as their products were not mature. Apple needs to grow oganically and not by purchases – its not their model. The board should remember whose interests they represesent- if there was a 5% dividend the stock would soar to 800. At this point that is their primary duty. Its a successful company but needs to show thier success as a stock also. It is absolute nuts to think that paying a dividend hurts the company – maybe Cook should try that himself and go for a $1. He will not have my vote as a board member next time- . He is just checking his God-meter
I wouldn’t sue for it (gosh think of the legal fees!) but really, what in the world is Apple planning to do with 100B!? That’s more that many state’s entire budget for a year! If that money weren’t locked up in Apple’s hands, what could (part of) it do for the economy overall?
If the money were not locked up in Apples hands IE a dividend, then it would go back into the fund(s) for the most part and be reinvested in maybe a loosing stock or more Apple. the only winners are the brokers that will pick up fees for buying the new stock.
As a shareholder I would hope vote not to pay a dividend. If others don’t like it, they have the right to sell their shares in the company at any time. I suspect with quite a nice profit and take their money and profits and open their own company and run it as they see fit.
Not one person I know personally wants Apple to do this so I ask “who” exactly are the shareholders demanding they do this? Where are these bozo’s getting this idea that shareholders want Apple to pay dividends.
It’s the predatory hedge funds, banks and financially institutions that own mega quantities.
These same assholes, manipulate the stock price with FUD and bogus news, distort and short strategies and they single handedly are the ones that make Apple stock very volatile with these practices.
Revolt against them and pressure the SEC to regulate their practices, if you really want a lucrative law suit.
Agreed.
I would get in on that lawsuit in an instant.
Then we will sue those who sue Apple. That is for sure.
“earning nothing more than a market rate of return,” Are they nuts????
It is earning Stability, Security, Advance purchasing to secure parts supply and lower cost.
I mean, how did those guys became investors?
Not to mention it provides the ability to take advantage of any opportunities available not seen by Apple outsiders.
It’s also a huge negotiating weapon. Has no one noticed there are a lot of greedy and jealous competitors who are gunning for Apple’s profits, customers, fame, and market.
Depriving Apple of money at this critical point in their history could be an utter disaster from their possible growth. A forever missed opportunity of a lifetime.
Hedge fund: ” We want a dividend”
Tim Cook: ” I got your dividend hanging”
The funny thing is that the cash is not “just sitting there”, it’s letting them run Apple the way they feel they need to. It gives them breathing space, lets them make bold leaps with their products (knowing they have a safety net in case they get it wrong) and it lets them make acquisitions and pre-purchases on materials.
They are getting a better return on that money by “keeping it in the bak” than I could by doing anything else with it.
Another link bait article.
Shareholders cannot sue Apple to pay a dividend
The writer does not know how Apple is using this cash and what earning nothing more than a market rate of return means. Apple is not stuffing cash in the mattress. Apple’s cash is not idle. Because they choose not to spend the cash on acquisitions of dubious design based on what some analyst says, they are considered “hoarding? How?
If I listened to the pundits, my Apple stock would be worth far less than it is now.
Anyone can sue over anything. But in this case, they would fail miserably.
No, they cannot. What the shareholders can do if they really want a dividend is elect board members who promise to declare a dividend. That’s their recourse.
I am a shareholder and believe that it might be time for Apple to pay a dividend (perhaps a one time dividend rather than a regular scheduled one). Tim Cook has said that the 100B is more than what it currently needs for its operations. However, I am respectful of whatever the board decides and NEVER contemplate suing.
I don’t think suing is feasible but its a moot point because AAPL will most definitely pay some sort of dividend this year. The cash pile is getting to the point where they can’t justify not doing it anymore.
If you get enough shareholder votes together to vote in your own board of directors, you can force a dividend program on the company.
Of course, there aren’t enough stupid shareholders to make it happen.
I would rather that Apple use some its cash to do something about data caps in mobile, by ISPs, etc.
Moving the cloud is great…except when you are subject to data caps when using the cloud.