“Bernstein Research‘s Toni Sacconaghi today chimes in with his thoughts on Apple‘s (AAPL) $137 billion cash pile, which is rising by $40 billion per year, noting that there is ‘a universal belief in the investment community’ that the money ‘is simply too high,’ and reiterating a view the company will do something to attract ‘incremental value investors,'” Tiernan Ray reports for Barron’s.
“Sacconaghi, who has an Outperform rating on the stock, and a $725 price target, cites a transformation in the shareholder cohort from growth funds to more value funds,” Ray reports. “The problem, of course, is the large overseas cash amount. The company has $43 billion here in the States, a ‘significant cash cushion.'”
Ray reports, “But Apple’s projected U.S.-based cash flow this year of $12.4 billion is actually $1 billion shy of the $13.4 billion he reckons the company needs to cover its $10 billion in planned dividend payments and the one-third of its planned share repurchases of $10 billion. He notes, means the company would have to either take on debt or pay taxes on repatriating the overseas holding.”
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