“Apple Inc lavished cash on its shareholders like no company in history in the first three months of the year and it intends to keep doing so, making the iPhone maker’s investors the clearest winners yet from last year’s sweeping U.S. corporate tax cuts,” Noel Randewich reports for Reuters. “With a mountain of overseas cash suddenly freed up by the tax overhaul, Apple bought back $23.5 billion of its own stock in the March quarter, a record amount for any U.S. company, according to S&P Dow Jones Indices, and it added $100 billion to its target for future repurchases. It also doled out another $3.2 billion in dividends and will boost them by 16 percent going forward.”
“The amount Apple spent buying its shares in those three months exceeded the stock market value of most companies in the S&P 500 index, including household names like Kroger Co, Best Buy Co Inc and Hershey Co.,” Randewich reports. “The decision to turn over record amounts of cash to shareholders was a direct results of the Tax Cuts and Jobs Act passed by Republican lawmakers in December.”
“The biggest overhaul of the U.S. tax code in over 30 years, the new law slashes the corporate income tax rate to 21 percent from 35 percent, and charges multinationals a one-time tax on profits held overseas. As a result, analysts had expected Apple to repatriate most of its $252 billion in cash abroad,” Randewich reports. “In its quarterly report on Tuesday, Apple said it would earmark $100 billion for a new share repurchase program, succeeding a $210 billion buyback program that started in 2012 and will wrap up this quarter – roughly nine months ahead of schedule.”
“Apple’s program dwarfs others even as stock repurchase efforts kick into high gear,” Randewich reports. “By comparison, U.S. companies in April announced a combined total of $50.4 billion in new buyback plans, up from $38.1 billion worth of planned buybacks announced in April 2017, according to TrimTabs Investment Research.”
Read more in the full article here.
MacDailyNews Take: As the number of shares declines, the value of remaining shares theoretically increases – supply and demand – but it also tamps down Apple’s market value (race to one trillion) if the share price stagnates (or, as happened multiple times this year, is talked down by pundits and herd-like analysts based on specious data points).
SEE ALSO:
Uh, yeah, about those iPhone X ‘concerns’ from analysts: Never mind – May 1, 2018
Apple beats Street with best Q2 ever – May 1, 2018
Apple’s iPhone X isn’t selling well – or is it? – April 21, 2018
Apple’s iPhone X to be discontinued this year, analyst claims – April 20, 2018
Morgan Stanley: Apple stock may fall on ‘materially’ weaker iPhone sales – April 20, 2018
Apple’s iPhone X made 5 times the profit of 600 Android OEMs combined – April 18, 2018
Apple’s iPhone captured 86% of global handset profits in Q417; iPhone X alone took 35% of global handset profits – April 17, 2018
Bernstein: Ams AG is biggest winner in Apple’s TrueDepth Camera system – April 10, 2018
Apple’s iPhone X is the UK’s most popular smartphone – April 9, 2018
Apple’s iPhone X sales continue to disappoint, some analysts say – March 22, 2018
Ignore the iPhone X naysayers – March 10, 2018
Will the naysayers admit they were wrong about Apple’s iPhone X? – February 5, 2018
Do iPhone X sales spell trouble for Apple? – January 30, 2018
Apple supplier says report of iPhone X production cuts was overstated – January 30, 2018
Another January, another misleading iPhone supply cuts story from Nikkei – January 29, 2018
Apple stock drops after Nikkei report of iPhone X production cut – January 29, 2018
Reports of Apple cutting iPhone X orders make no sense – January 2, 2018
Apple stock tumbles on one poorly-sourced report of low iPhone X demand – December 26, 2017
Apple and suppliers shares drop on report of weak iPhone X demand – December 26, 2017