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There are a number of things I think Apple could buy that in some way compliment their current businesses. Verifone has done terribly and that would get them into the payment terminal market, which I think will be a bigger focus in the coming years with mobile payments, EMV, etc. I hope they don't actually, as I own one of Verifone's competitors, but that's one idea. There are tons of others. They could buy out Corning, maker of Gorilla Glass, and corner the market for that.
However, the fact that they haven't really done anything significant with the cash says something. As for what you'd have to ask Tim Cook.
As for Einhorn, I don't think he's gone too far in that this sort of thing now seems like the norm. Large hedge funds with a greater and greater ability to push for what they want (Ackman, Einhorn, Icahn, Loeb, etc) are becoming more commonly seen and trying to push for an even greater influence than before.
Apple was probably getting down towards where Einhorn bought it and uncomfortably close enough that he decided to push for change.
Wait. Why in heavens name would Apple use up its Cash Hoarde to buy any company? It will use its artificially pumped up stock. Why pay for something when you can get it for free?
So what does Apple Buy? TV !!! Of course, if I'm right, my ANALysis will not yield me anything.
To me this is nothing more than a shareholder trying to manipulate a holding in their favor. Seriously, how many of these activist rants ever end in favor of the greater good? Einhorn has probably had mor failures than successes in these matters but his successes have made him a ton.
Apple is an idea company and its current ideas are being copied or improved upon. Unless it has another disruptive product to spring on the world (and preferably another in reserve), it needs to bring its dividend at least to the 3.5% level of MSFT, because it will soon (time is relative - 1, 3, 5 yr?) be a value company. Buying an under-performing company to improve it (Verifone), implies you know how to restructure it. Buying Corning makes some sense, but can't cost $30B, and may just stimulate competitors. Increasing the dividend to MSFT level might attract value investors, and there would still be money left to grow and hire talent. With Gates on the board, this seems reasonable.
Reply to @Maurice: Apple has announced a nominal stock buy-back program, but the exact $ amount/number shares is unknown. I suspect it is not large enough to keep pace with the increasingly large cash position.
In contrast, Berkshire Hathaway also maintains a large position and does not paid a dividend. The large cash allows Buffett to take large positions, including acquisition of the entire company. Yet the call for dividend has went on for years. One can expect Apple will buy other business in their own terms.
Comments
However, the fact that they haven't really done anything significant with the cash says something. As for what you'd have to ask Tim Cook.
As for Einhorn, I don't think he's gone too far in that this sort of thing now seems like the norm. Large hedge funds with a greater and greater ability to push for what they want (Ackman, Einhorn, Icahn, Loeb, etc) are becoming more commonly seen and trying to push for an even greater influence than before.
Apple was probably getting down towards where Einhorn bought it and uncomfortably close enough that he decided to push for change.
Edited to add: the stock's only up less than 1%.
On the tube, the talking heads were saying that all the apple investors were cheering and glad someone finally spoke up. I have no idea, personally.
peace,
rono
So what does Apple Buy? TV !!! Of course, if I'm right, my ANALysis will not yield me anything.
In contrast, Berkshire Hathaway also maintains a large position and does not paid a dividend. The large cash allows Buffett to take large positions, including acquisition of the entire company. Yet the call for dividend has went on for years. One can expect Apple will buy other business in their own terms.