Visa was one of Braden Dennis’ favorite companies, and he discussed how he likes to discover companies with high ROIC, which is actually a measure of how well the company’s management is doing (V).
Honestly, I’m a big fan of Visa, and I consider them my “favorite buy and own for eternity” company because of their strong ROIC and dividends.
They could have invested more and grown the business more quickly, right? So why are they handing out dividends if they’re efficient consumers of investment capital?
In terms of dividends, those are the two things I keep going back and forth on in my mind, and I know it might seem like I didn’t mention Apple at all, but trust me you’ll see where I’m going with it.
When it comes to Apple’s dividends, as I’ve already indicated, how has the dividend’s history looked through time?
Compared to other companies I’ve studied, like JNJ and MMM, Apple has a strange history.
Dividend kings are both of those firms, whereas Apple is clearly not.
From 1987 to 1995, Apple paid a very constant dividend, but then took a long vacation, only to take the dividend back up in 2012 and pay it up to today, September 2021, with their most recent dividend of $.22/share, which is a yield of.58 percent.
If Apple stopped paying dividends in the late 1990s, why is it still around today
Some people may be surprised to learn that Apple had considerable challenges early on in the life of their organization.
Because they were competing against the big dogs, they were severely short on funds.
Because Apple was a true disruptor (changing the market from CDs to MP3), it required a considerable amount of capital from the corporation, thus paying out a dividend was just not an option.
Another reason why you’ll see these tech companies make acquisitions rather than expand organically is because they need to grow in a specific way.
If a competitor is doing a terrific job in an area that may benefit your company, it may be more cost-effective and efficient to acquire them.
Just buying the company will allow you to quickly benefit from the synergies that have been built up over time, rather than spending years and years attempting to catch up.
As a result, Steve Jobs desired to keep a little sum of money:
As a result, “we know that if we need to acquire anything, a piece of the puzzle to construct something large and bold, we can write a check for it and not borrow a lot of money and put our entire company at danger,” he said. “We feel safe and free since we have so much money in the bank.”
When Apple ceased paying dividends in the 1990s, the International Business Times ran a cool Q&A to explain why a corporation might wish to keep that cash in reserve.
If you only look at Apple’s dividend history, you’ll lose out on a lot of information.
Here, you can see that the dividend is very steady up until 1995, when it entirely goes down, and then picks back up in 2012::
What is Apple’s dividend per share?
The dividend yield is a better indicator of a company’s ability to pay out dividends than the dividend payout, which is commonly utilized in fundamental analysis of stock investments.
Stock price appreciation is typically not a focus for dividend investors. The dividend yield of a stock is the annual dividend divided by the stock’s current market value. As of the second quarter of 2021, Apple paid out a dividend of $0.22 per share. Apple’s dividend yield was 0.6 percent as of July 18, 2021, when the company’s stock was trading at $149.39.
Because its stock has risen at times far more rapidly than its dividend yield, Apple’s dividend yield may be less competitive for investors interested in dividend income, even though its yearly dividends have increased continuously since the company’s resumption of its 2012 payout in 2012.
How often does Apple stock pay a dividend?
Do Apple Pay Dividends Frequently? Apple, like the majority of dividend-paying US corporations, distributes a quarterly dividend payment to its shareholders.
Does Apple pay dividends 2021?
When Apple Inc. (AAPL) goes ex-dividend in 2021, it will begin trading on November 5th. On November 11, 2021, shareholders will get a cash dividend of $0.22 per share. In order to receive the dividend payment, AAPL shareholders must have purchased the stock prior to the ex-dividend date. AAPL has paid the same dividend for the third quarter in a row. As of this writing, the dividend yield is.58 percent.
Why is Apple’s dividend so low?
This is because Apple’s new loan has a low interest rate. On the $2.5 billion of five-year notes, which bear a lower after-tax interest expense for Apple than the after-tax cost of the cash dividend that Apple pays its ordinary stockholders. However, Apple is not able to deduct the dividend from its taxes.
Do Tesla pay dividends?
On our common stock, Tesla has never paid a dividend. We do not expect to pay any cash dividends in the near future because we plan to use all future earnings to fund future growth.
What was Apple stock worth in 1980?
On December 12, 1980, Apple went public at a price of $22.00 per share. As of the IPO, the company’s stock was trading at $. 10, but it has since split five times.
Are dividends paid monthly?
Although some corporations in the United States pay dividends monthly or semiannually, the majority pay quarterly in the United States. Each dividend must be approved by the board of directors of a corporation. The ex-dividend date, dividend amount, and payment date will then be announced by the corporation.
How much is Apple’s debt?
Preliminary SEC filing for a four-part debt offering that includes notes with 7, 10, 30, and 40 year maturities was submitted on Thursday. No details about the size or the timing of the sale were given by the corporation.
A total of $113.8 billion of Apple’s (AAPL) long-term debt, including current maturities, is outstanding. The figure is based on a February offering of $14 billion.
