I don't know much about stock and companies with money, but people on this thread are implying that Apple must get rid of it's cash? Why? Surely cash is good? Safety net? What if the sales plummet you don't go out of business, etc. etc.?
the Wall St logic is that since Apple are not spending the cash and it is just sitting there and earning almost nothing then you are better off giving it back to investors to invest for themselves (buying t-bills isn't hard, we can do that ourselves).
the century old idea of stocks (and what buffet et al subscribe to) is about generating a yield from profits. the secondary effect is that now those types of investors will buy into Apple since it yields a dividend, like a good old blue chip stock should (which in-turn raises demand for the stock, which in-turn raises the share price - meaning the cash is being put to better use).
They were pressured by wall street to actually do something with the money.
I for one would have liked to see apple carry the cash balance. Sure they aren't making much from the cash, but I'm pretty sure there are better uses of the money. For example, why not buy a few suppliers?
Apple believes that it can offer a better return on that cash by giving some portion of it back to it's owners/shareholders than by continuing to hold it all in reserve. That's really all this is about.
> The CEO and board have a legal responsibility to use those funds in a way that maximizes shareholder return or return it to the shareholders.
Please stop spreading this and related myths about the legal obligations of corporate officers and directors. They have a fiduciary duty, which has nothing to do with "maximizing shareholder X", or taking any other particular course of action.
These myths are simply a way to fool the masses into accepting amoral people acting in ways detrimental to society.
I don't know much about stock and companies with money, but people on this thread are implying that Apple must get rid of it's cash? Why? Surely cash is good? Safety net? What if the sales plummet you don't go out of business, etc. etc.?