How Will Apple Manage Its War Chest of $60 Billion in Cash?
Apple topped Barron’s ranking of the most respected companies, and that’s due to its stock performance:
Riding its soaring financial results, the company’s stock zoomed 53% last year and is up nearly 11% this year, to $356.85 as of Friday. Its stock market capitalization of $328 billion is second only to Exxon Mobil’s $412 billion.
Apple has become more than just a tech company, it now possesses over $60 billion in cash. In comparison, Google has $30 billion, and Intel just over $20 billion. What to do with all that cash?
Using cash to secure components appears to be the plausible choice, as a recent report states that Apple is about to invest $7.8 billion into Samsung components, making Cupertino the #1 customer of the South Korean conglomerate. The iPad alone, is a $16 billion dollar market, which makes it a ‘company’ within itself.
Will Apple ever offer a dividend to investors? Right now, all that cash in the bank gives Apple breathing room over its competitors, says Steve Jobs (via G&M):
Appleâ€™s CEO, Steve Jobs, has said â€œcash in the bankâ€ gives his company â€œtremendous security and flexibility.â€ If Apple needs to acquire a piece of the puzzle to make something â€œbig and bold,â€ they can simply write a cheque. And now that Apple is back in the big leagues, it needs lots of cash to make moves that can â€œmove the needle.â€
What should Apple do with all of its cash on hand?