Now that Apple (AAPL) has decided to make a dividend payment for the first time in more than a decade, we wanted to see who stands to benefit the most from the iPhone maker's decision to give back some of its $98 billion in cash.
The company said Monday that it plans to buy back some $10 billion in stock and pay $2.65 on each of its shares every quarter. Assuming it does send those dividends out and it stays at that rate, that would equate to a payout of $10.60 a year on each of its shares. That's quite a sum. Apple has nearly 932.4 million shares outstanding, meaning that roughly $9.9 billion in dividends would be paid annually.
While that's a staggering amount, Apple's not in danger of running out of cash anytime soon. Even if it never generates another dollar, and that isn't a consideration, it has several years worth of money to distribute. If you're worried, don't be, at least for now -- Apple's bringing in billions of dollars a year that it can use to cover the dividend obligation.
Institutional investors, the large professional asset managers and market participants, own 71.7% of Apple's stock outstanding, and that means big players are poised to see the biggest checks. However, it's important to note that large financial companies are highly diversified, and as a result, holdings can be spread out over multiple subsidiaries. Also, the numbers we'll cover don't necessarily mean the firms listed here are going to pocket every penny of the dividends -- for instance, many of the shares are held by mutual funds that are themselves owned by individual investors. So with that said, here's a sample of who will get what. Data are from FactSet.
In total, Fidelity Management & Research Co. has just over 49 million shares. That means the firm is in line to get $519.4 million on its current holdings. (To illustrate the point above regarding ownership, the Fidelity Contrafund and its holders have about 14.5 million Apple shares.) BlackRock Fund Advisors is next with 37.83 million shares, which would indicate it's due $400.1 million in dividend payments. Following from there is Vanguard Group Inc., whose 37.19 million shares would set it up for $394.2 million in dividends. Mutual fund manager AllianceBernstein has 6.24 million shares, for $66.1 million in dividends.
Among investment advisers, top holders are Mellon Capital Management Corp., whose 4.58 million shares would tally dividends of $48.5 million, and JPMorgan Asset Management (UK) Ltd., the owner of 4.52 million shares that should see a $47.9 million payout. On the hedge fund side, Citadel Advisors LLC has more than 2.79 million shares, good for $29.6 million in dividends due, and for pension funds, the New York State Common Retirement Fund's 3.27 million shares should qualify it for $34.7 million in dividends.
Turning to individual holders, Ronald B. Johnson, who recently left Apple to become CEO at JC Penney (JCP), has 233,000 shares. That should equate to $2.47 million in dividends. Arthur D. Levinson, Apple's non-executive chairman, has 186,000 shares, enough for $1.97 million in dividend payments.
As for recent ownership changes, the biggest buyers of Apple stock in the past six months are Putnam Investment Management LLC, which has added 4.73 million shares, taking its total to roughly 7.4 million shares, and Capital World Investors, which has has bought 2.50 million shares, giving it a total to 15.66 million shares.
Deustche Bank Investment Management Inc. was a big seller, parting ways with 3.85 million shares and leaving it with 2.99 million shares. Marsico Capital Management LLC sold 1.88 million shares, giving it 3.14 million shares.