One of the best reasons to buy a lottery ticket is simply to allow yourself to dream. What would I do if I won $100 million dollars? I've done it many times and I think it's well worth the buck, if only for the bonding opportunity it creates with your fellow man. Unless, of course, that man is the type who says they wouldn't change a thing and would show up to work the next day as if nothing happened. Thanks a lot, dream crusher. I hate that.
That's how I feel about Apple (AAPL) today, only in a much stronger way, since their pot of gold was almost $100 BILLION dollars, not some paltry 9-digit figure, and they just agreed to part with a whopping 20% of it. (That's $10 billion worth of share repurchases and $10.60/share in presumed annual dividends on approximately 940 million shares.)
That's right, the biggest, most innovative company in the world at this time just put forth the most ordinary and underwhelming solution for utilizing the most conspicuous cash pile on earth.
The crux of my disappointment is the fact that "this problem" isn't solved by today's moves, even though it has been out there forever and investors have literally been asking the cash question for years as Mount Apple grew larger and larger. Even today, the company persists in its "we have more cash on hand than we need to run the business" dogma, which is why their proposed fix screams that they've not only run out of dreams but are running short on nerve, too.
If Steve Jobs were still alive, would he have supported such a cautious course for his company? I think not. This move is about execution elbowing out excellence or excitement.
What would have excited investors who have seen this company go from $5 to $500 in the past decade? Here are my top 5.
1) Immediately give shareholders a $25/share one-time payout. Cost: $25 billion.
2) Invest in America and re-import jobs from China to the most high tech, efficient manufacturing plants in the world. Cost: $25 billion.
3) Increase the hourly wages of your remaining foreign workers by 50%. Cost: $10 billion.
4) Donate 50 million iPads to schools. Cost: $20 billion estimated.
5) Nothing. If you don't have something good to say, don't say anything at all.