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Apple’s Record-Breaking $110 Billion Stock Buyback
May 3, 2024
Apple Inc., one of the world’s largest tech companies, has just made history with the largest stock buyback ever seen in the United States. The announcement comes as the tech giant’s board approved an additional $110 billion in share repurchases.
This move surpasses Apple’s previous record set in 2018 when it authorized $100 billion in share repurchases. Data from market research firm Birinyi Associates dating back to 1999 highlights Apple’s dominance in this arena, with the company responsible for the top six of the 10 largest share-repurchase announcements in the U.S.
According to Steve Sosnick, chief strategist at Interactive Brokers LLC, this sizable buyback signifies a shift for Apple towards being a value stock that prioritizes returning money to shareholders over aggressive growth strategies.
“Apple may be acknowledging that they are becoming a value stock that returns money to shareholders rather than a high powered growth stock that needs its cash for R&D or expansion.”
Steve Sosnick, chief strategist at Interactive Brokers LLC
Apple’s quarterly results, released post-market on Thursday, exceeded investor expectations. Sales outperformed estimates, and the company anticipates returning to revenue growth in the current period. Additionally, Apple raised its quarterly dividend for the 12th consecutive year, indicating a positive outlook for investors.
The news led to a significant boost in share prices, with a 7.9% increase in after-hours trading. If this trend continues, Apple stands to gain over $190 billion in market value.
This surge in stock value is particularly notable considering Apple’s performance relative to its peers. Despite a 10% decline in its shares this year, the broader market has seen a more than 6% increase in the S&P 500 Index.
Overall, Apple’s monumental stock buyback and optimistic quarterly results signal a potentially promising future for the tech giant and its investors. This marks an interesting historical moment in U.S. business.
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