Save $2.23 Billion

By  via   Article


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.'”


Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )


Connecting to %s

%d bloggers like this: