How to Acquire Apple’s Outstanding Shares
If you’re interested in acquiring Apple’s outstanding shares, you’re probably wondering how you can go about doing this. It’s a fairly straightforward process, but the first step is to find a broker who can assist you in this endeavor. The next step is to decide on the price you want to pay. Once you’ve decided on this, you’re ready to buy.
Apple's value comes from iOS, iTunes and iCloud
If you are a dedicated Apple fanboy or gal, you are in luck. Apple has a large and diverse product portfolio. From its flagship iPhone to its myriad iPod touch brethren, the company is capable of delivering a dazzling array of high-end mobile hardware and services. The aforementioned products and services make up the bulk of Apple’s $13 billion quarterly haul. It is also in the business of providing ad hoc solutions to your mobile woes, such as delivering mobile app updates and making sure that your data is secure. As the tech juggernaut is, Apple is a savvy partner of choice when it comes to deploying your digital assets. To put your mind at ease, your iPhone is backed by an all-encompassing network of dedicated support centers.
Hedge funds are underweight AAPL
A new report from Jefferies Equity Research shows that hedge funds have been underweight to the S&P 500 Index since October of 2020. It also shows that growth stocks are back and that cyclicals are starting to gain strength.
Apple is the seventh most important position among hedge funds. Almost 191 hedge funds own the stock, which accounts for a little over 2% of the S&P 500. The average hedge fund holds 68 percent of its portfolio in the top 10 positions.
Despite the fact that the company’s share price has been a Jekyll and Hyde this year, many money managers still believe it’s a good time to invest. They’re rushing to tech megacaps such as Apple. But with Apple’s market value at around $117, most analysts expect its shares to reach at least that value in the near future. Interestingly, the average mutual fund remains underweight to the tech sector. According to the report, the average fund’s underweight to the S&P 500 Index was 11 percent at the end of the first quarter. However, it was down to nearly five percent in the second quarter.
Among the leading tech stocks, hedge funds are now underweight to Alphabet and Microsoft. This is because most diversified managers are betting against the top two stocks in the index.
But as the stock grows, underweighting it will hurt performance. Hedge funds may use leverage or volatility arbitrage. In other words, they may buy or sell the stock depending on the market’s price movement.
The average hedge fund’s underweight position on Apple is lower than most would expect, but that doesn’t mean that it’s a good time to invest in the company. There are more factors that play into a stock’s valuation than just its price. These include price momentum, cash flow to enterprise value, and price-to-book.
As a result, a fund manager must weigh the risk of investing in a big tech company against the risk of underweighting the stock. That’s a difficult balance to achieve. Hedge funds tend to be less liquid than mutual funds. And they may be more aggressive. Their strategy is to try to maximize the investor’s returns. Some hedge funds are very aggressive, while others are more conservative.
Apple's path to buying back 50% of outstanding shares
Apple’s share price has been exploding in recent years, with its market cap increasing by almost 252%. The increase in share price is driven by the company’s strong cash flow and robust capital return programs. But the stock’s P/E ratio has also expanded in the past few years. Buying back shares is becoming more expensive for Apple, which may make it harder for the company to buy back 50% of its shares in the next three years.
Although the company has taken on a lot of debt to fuel its share buyback program, it still has a considerable amount of cash on its balance sheet. This cash, plus the free cash flow generated from its services business, should allow the company to keep buybacks at current levels in the near term. However, if interest rates stay high, the company could decide not to use its cash to buy back shares.
It would be easier for the company to continue its share buyback program if it had a larger cash balance. Currently, the company has about $250 billion in cash on its balance sheet. There is also a large amount of idle cash that the company generates, mostly from its iPhone business. If the company had a net cash balance of zero, it would be unable to buy back any more shares.
To maintain its current share count, Apple would need to buy back about 3.3 billion shares in the next three years. However, the number of shares outstanding would fall to roughly half its 2012 level. During this period, the company’s earnings per share would rise from $0.38 to $0.92.
If the company kept its quarterly buybacks at current levels, it could repurchase a further 16% of its shares by the end of 2019. By 2023, the company’s share count would be 3.2 billion, and its total outstanding shares would be approximately 32% lower than the peak.
In addition, Apple’s dividends have increased by more than 40% in the last nine years. This increase in dividends is primarily the result of share buybacks.