Apple stockpiled $252.3 billion overseas, but it’s bringing that money back to America. A market analysts predicts the company will spend $100 billion of it on its stock buyback and dividend program. This will directly benefit those with Apple shares.
The company decided to bring the money home from foreign banks after the new GOP tax law gave companies a limited time for cash repatriations at lower rates, possibly just 8 percent.
Jim Suva of Citi Research wrote in a note to investors, “Looking ahead, we expect investor focus to be on the impact from Apple’s capital returns strategy, which we estimate could be a $100 billion increase.”
Apple has revealed some of the ways it plans to spend the cash it’s bringing to the U.S., including building another campus. It hasn’t said anything about putting an additional $100 billion into its stock buyback and dividend program, however.
Still, the company has already authorized its capital return program to spend $300 billion. It spent $32 billion in each of the past five years buying its own shares. It gave out about $12 billion in dividends in 2017.
Benefits for Apple shares
There are just over 5 billion Apple shares outstanding at this time, so the analyst’s prediction could eventually lead to $20 of additional money for each share, whether in increased share value or dividends.
Mr. Suva is quite bullish about Apple, with his note to investors saying he thinks shares should be priced at $200. They are currently at $174.
The company will announce the results of its most recent financial quarter — January through March — on May 1.