Wednesday, October 27, 2010

How Should Apple Spend Its Money

Stockpickers and shareholders continue to speculate with how Apple should spend its earnings. Its top executives are cashing out their restrictive stock options and shareholders seek even more ROI. So what should Apple do? Release a dividend like Microsoft started a couple years ago. Split the shares 2:1 or more to encourage more investors to the stock and push higher the stock price. Or grow through acquisition.

Well the speculation has started. "Shares of Sony Corp rose nearly 3 percent at one point on Tuesday, but later retreated as analysts dismissed speculation that the electronics maker could be an acquisition target of Apple Inc." But if not Sony, who? Should they consider a web company like Yahoo, a CE firm like Panasonic, or perhaps Tivo. How about a content creator like NBC or CBS. Should Apple expand beyond its core strength of developing products that others can build software that Apple can resell. The App Store and iTunes are working quite well.

Apple has stated it has over 51 billion dollars in cash ready to use. But according to Steve Jobs, he is not under any urgency to spend it quickly. So far he has made all the right moves while its nearest competitor, Microsoft, has had a number of disappointments. For those that trust what Apple is doing, surely more good things will come.

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