“Apple shocked the market last week, delivering not only a top- and bottom-line beat when delivering its fiscal third quarter financial results, the tech giant provided strong fourth quarter guidance, effectively killing rumors that it would delay the launch of its highly-anticipated iPhone 8,” Richard Saintvilus writes for Nasdaq.
“The headline numbers, meanwhile, weren’t the only thing to be excited about,” Saintvilus writes. “The market ignored how massive Apple’s capital distribution program — often taken for granted — has become. Apple’s Board padded the company’s capital return program by $50 billion, while extending the distribution timeframe by four quarters. Analysts have asked whether that is that the best use of Apple’s cash.”
“The company has taken some 20% of the float off the market just in the past five years. And if you’ve held Apple stock during that span, you’re up almost 80%,” Saintvilus writes. “Aside from helping to stabilize the stock price, which prior to the buybacks, were extremely volatile, Apple’s purchases have seemingly been well-timed and executed — more often than not — when the share price was undervalued.”
Read more in the full article here.
MacDailyNews Take: Apple’s buybacks and dividends certainly were effective in not only stabilizing the share price, but also in tamping down most of the Wall Street demands that Apple “do something with their cash” (execute large acquisitions).