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Apple To Launch Largest Stock Repurchasing Plan In History
An anonymous reader writes "In conjunction with its earnings report for the second quarter of 2013, Apple issued a press release announcing some major plans for its ever growing stockpile of cash. It is increasing its quarterly dividend payout to investors by 15%. What's more, the company will spend $60 billion in stock repurchases, making it in Apple's words, 'the largest single share repurchase authorization in history.'"
It really isn't so much that they are going to waste it (though that is always a concern). investors/shareholders make money from one of 2 ways (like it or not investors are their to make money), either the shares go up in value or they receive an income as dividend from those shares. Apple doesn't have to provide stellar growth, they can continue on with their excellent profit and earnings with no growth, however to do so they need to change the way they are returning value as without growth shareprice will stagnate which means you have just removed the traditional way that Apple investors were getting value from the shares. buybacks and dividend allow investor returns while also bolstering the shareprice through desirability as an investment. What they are doing makes sound business sense even if like me you despise them.