Save $2.23 Billion

By  via tech.fortune.cnn.com   Article

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Apple’s shrinking diluted share count

“FORTUNE — By the time it decided in April to increase its stock buyback program five fold — from $10 billion to $60 billion — Apple (AAPL) already spent $1.95 billion of the original $10 billion fund and had bought and retired nearly 4.1 million shares of Apple common stock. …

That leaves … $58 billion to be spent over the next 11 quarters. …

As a result of the exercise…:

  • The repurchase program represents a material boost to Apple’s bottom line. For example, even if September’s net income were to be flat, Apple would report nearly $.25 more in EPS (earnings per share) because there will be that many fewer shares in the denominator.
  • By the end of the program, Apple will have repurchased just under 100 million shares, or approximately 10.55% of its current diluted share count.
  • The company will save more than $2.230 billion in dividend payouts on the retired shares — even if it  increases its dividends 10% each May. …

‘The dividends saved each year will go a long way to covering the interest costs on the funds borrowed to facilitate the share repurchases … while Apple continues to earn interest on the off-shore funds not repatriated and used for the share repurchases.'”

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