“In 2014, Apple (AAPL) was a darling of the market all year long. Shares of the technology giant gained roughly 40% in 2014, compared to the market’s 12% gain,” Bob Ciura writes for The Motley Fool. “Recently, Apple’s stock price has taken a dip due to the sell-off in the broader market. With such impressive gains in the book and Apple’s stock price looking shaky, it may be tempting to take profits and sell out. But that would be a huge mistake.”
“Based on the product releases that will boost Apple’s profits in 2015, I’m betting the company will out-perform its rather modest expectations. Analyst estimates still look too low considering the many catalysts Apple has working in its favor, and if Apple can manage to top these projects, its valuation multiple is likely to expand,” Ciura writes “And, there’s always Apple’s dividend, which is surely set to grow as its earnings grow, too. Apple pays a 1.7% dividend yield, which is slightly below the market average, but Apple increased its dividend by 7% in 2014 and by 15% the year before. The $11 billion in dividends paid to shareholders in fiscal 2014 accounted for just 22% of Apple’s free cash flow. That leaves plenty of room for future dividends to grow at double-digit rates.”
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