What a great time for a special dividend of $30 per share.
Reasons to do that?
1. They began the Q with ample domestic cash for that even before considering the what, call it $15B+/- of incremental cash flow generation for the quarter. They can always bring cash back from offshore as the deferred tax piece has already been reflected in the financials -- it is a matter of relieving the deferred tax liability account and wiring the funds, not an earnings hit.
2. It would send a message about the new militancy of Cook's willingness to protect employee morale and demonstrate new sophistication on capital management. Incidentally, it would decisively F over the #$%$ saying AAPL is the new dell or msft or RIMM (or any other companies the idiots like Cramer and the gumptards here reference as the reset/no growth aapl). Apparently none of them understand the deltas on extra week, improving margins guided for March vs Dec Q, solid increase in guided revs for march yoy; or that AAPL really shouldn't be viewed as a 5x earnings stock like Cramer, Grundlach and other clowns -- even Misek now -- suggest is coming.
3. The tax noise/advantage of 3% if they had done it last year is over for individuals, but anyone who has been/remianed long for more than 3 months without hedge offsets has unrealized losses to reverse and those will largely evaporate with a solid jolt to the stock down here. I think almost no retail account would object (as if that matters) and EVERY PM I KNOW STILL LONG THE SHARES WOULD APPLAUD THE ACTION. It is not well understood, but the hedge fund and other players benefitting from "carried interest" deferrals are only paying cap gains taxes anyway.
4. Fav press would help staff morale too, be good for the BOD and Tim's reputations, and ensure AAPL never again finds itself subject to such a ridiculous and undefended attack by pot-smoking bond managers or anyone else with fleeting swagger walking into the gelding operations facility. LOL
special divi is a one-time event that will mostly end up in the pockets of WS crooks. Raise the divi to $15 or $20/share as another poster suggested - I would prefer that as a retail investor and would attract many value/retirement funds as well...
Sentiment: Strong Buy
Reasons not to do it:
1. It would require repatriation of $30 billion, which would cost apple $40 billion once you count the tax.
2. Screw the short term investors, and the long term investors will get paid regardless once Apple recovers.
3. Screw the favorable press, the press and the analysts are total idiots.
Sentiment: Strong Buy
1. That level would not require any repat if you study what i wrote. And the tax is already reflected in the financials.
2. Players buying/owning the shares will be just fine here over time. Now that many have hurled off the back of the boat, S their pants and are writhing, moaning on the floor, we are near the bottom. I'm talking about scalping the shorts -- not "short term investors."
3. I'm not talking about getting fav press for retail aapl investors, and we agree most of the analyst community is not worth following in any sector except for healthcare/biotech. You may not care about the impact of 100% condemnation in the press, but anyone who has managed a large, multinational organization needs to be entirely concerned about that. AAPL pays Foxconn employees double what the Asian makers pay them -- do you read about that anywhere? AAPL is building both real and lip service assembly and data center sites doemstically for employment and sentiment purposes.
4. It is a disaster for employee morale to be slammed as the stock reels when if the story was being better told by the cfo and IR staff the stock would not have dropped below a 10% or so pullback. Those options shares all the engineers have are like "jelly of the month club" coupons when all of them can leave for more comp elsewhere. Many in SV love to hate AAPL -- always been that way -- but all employers want to hire them and good staff when can. Cook and the BOD if Tim doesn't, need to do something decisive on massive excess cash. A $30 div would do THAT.