Chief investment officer of Gamco Investors, Howard Ward, today said that Apple is planning to reveal its plans for what to do with the enormous amount of cash by next month. Apple needs to respond to growing criticism over what it’s doing with its $137.1 billion in cash and investments, not to mention the $42 billion in earnings investors expect Apple to add in 2013, says Ward.
Of course, the opinions on what Apple should do have been divided. David Einhorn wants Apple to give high-yield preferred shares to investors to spread the funds. Other investors would like a higher payout in dividends.
“We’re going to get an announcement from the company as to how they intend to reallocate some of their cash,” said Ward, in an interview today with Bloomberg’s Tom Keene. “They will put a floor under their stock at a higher price than it is today.”
Capital Advisors Inc’s president, Keith Goddard, said that he thinks Apple will announce a dividend or buyback this year, possibly as early as April. “It really is mind-boggling to me that they’re being so stubborn about sitting on so much cash,” said Goddard, who’s firm claims to own 23,100 shares of Apple stock.
Apple’s board has said in the past hat it’s actively discussing how to deal with the extra cash (a problem we all wish we had, am I right?), and that it might consider buybacks of stock or larger dividends. Whatever the Cupertino-based company chooses, of course, there are bound to be as many opinions on their actual decision as there have been on their possible decisions..