Apple’s dividend is a gift

“Apple made headlines this week by announcing that, at long last, the company would start paying a dividend,” Charles Sizemore writes for MarketWatch.

“This is fantastic news, not just for the Apple shareholders that had been agitating for the change, but also for the broader investing public,” Sizemore writes. “With $100 billion in cash sitting on the company’s balance sheet more or less inert, Apple was doing a real disservice to its long-term shareholders.”

Sizemore writes, “And herein lies a key point: long-term. The growing popularity of dividends in recent years may be the most positive development in the capital markets in my lifetime. It’s a return to a more sober, rigorous form of investing that favors stable, long-term returns. It takes away the casino gambling mentality and replaces it with something far more constructive.”

Read more in the full article here.

14 Comments

  1. Very good point about long-term investment. Fifty years ago, my uncle mention dividends he got from his IBM stock. I never liked this modern casino emphasis. It’s what got so many into big trouble.

  2. It is a gift. My 3000 shares bought on average price of $330 over four years now give me $23000 a year after taxes. I live outside the US so tax rate on dividends is 30%.. Thing is, shares will rise as will Apple’s profits, so cash will continue to grow. This dividend is a minimum level, expect it to rise. And seriously, $100 billion and no debt gives Apple the freedom to do anything it wants. If not, just hold off raising the dividend for a few quarters and amass a whole lot of money.
    Analysts complaining are just really bitter they missed the train. They can’t even see it’s worth getting on the train now. Lots of shorters trying to drive the stock down below $600 again but it ain’t working no more!

    1. Finally someone posts about paying more than $10 per share for AAPL. That was a smart and ballsy move buying at $330. I bought my 1500 shares at $144 in June of 09.

  3. Without dividends, the market would essentially be a zero sum game, with people just swapping shares based on perceived value.

    There comes a point in time where a well run business makes enough money to keep it running well and distribute the remainder to its investors.

    Cash flow is king.

    1. “It’s a zero sum game, somebody wins, somebody loses. Money itself isn’t lost or made, it’s simply transferred from one perception to another.” – Gordon Gekko

  4. You just have to think that MOST of the share price increase has happened in 5 years of growth.. There is an entire planet out there… Imagine ten years from now! I just don’t understand Apple not going for the windows business market.. it’s huge with big budgets. Regardless, I feel that the young generation will insist on using macs in a business climate. That is what they know… I often imagine all the kids growing up on macs getting a college degree, (on macs) and then being forced to work on a PC at their first career job..Talk about sucking… it CANT be a smooth transition… I HATE PCs.. I am like a fish out of water on a PC… seriously.. So it has to be non productive.. They will want MACS. As a business owner at a video editing house,, we’ve never needed a PC. Just figuring the upside for stock in that business climate. Good day.

  5. If you can’t buy a hundred shares of AAPL try buying options. It’s a great way to enjoy the profits of a hundred shares without as much Capitol. I’m loving it right now. email me if you like to know how🍸

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