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Apple dividend may return part of $98-bn cash [Financial Express (India)](Financial Express (India) Via Acquire Media NewsEdge) Apple, approaching a $500-billion market capitalisation, will probably start paying a dividend this year, attempting to appease investors who have said the electronics maker is hoarding too much cash. The company is likely to declare a quarterly dividend of about $2 a share before the year is out, according to data compiled by Bloomberg. The projections are based in part on the dividends paid by other large technology providers, including Microsoft and International Business Machines. An Apple dividend would be a boon to investors and would probably yield benefits for the company, which has $97.6 billion in cash and investments, and can afford the $7.46 billion a year that a $2 dividend would cost. A dividend could provide a boost to Apple by attracting a new class of investors that only hold stock in dividend-paying companies. Apple also may buy back shares, another move that could lift its stock price. Chief executive officer Tim Cook said this month that officials are in "active discussions" about what to do with the company's cash and investments, saying that the sum is "more than we need to run a company." Cook isn't likely to get much argument from investors. "Why not do the sensible thing and begin to share part of the capital that any rational person would say is beyond what the company needs to sustain itself with shareholders," said Keith Goddard, CEO of Capital Advisors Inc., an Apple shareholder. Other investors that have called on Apple to pay a dividend include Wedgewood Partners Inc. and Sustainable Growth Advisers LP. Analysts at Morgan Stanley, JPMorgan Chase, Mizuho Securities USA and Sterne Agee & Leach also predict that Apple will institute a dividend some time soon. Apple generated $16 billion in cash in the first quarter of fiscal 2012. Shaw Wu, an analyst at Sterne Agee & Leach, predicts Apple will generate about $75 billion in new cash this year alone. Steve Dowling, a spokesman for Apple, declined to comment. Euro-region inflation slows as economy weakens Euro-area inflation unexpectedly slowed in January as the economy cooled and governments cut spending across the 17-nation currency region. The inflation rate in the euro area dropped to 2.6% from 2.7% in the previous month, the European Union's statistics office in Luxembourg said. It had initially estimated January's inflation rate at 2.7%. Before the revision, economists forecast February inflation, due on Thursday, to slow to 2.6%, according to the median of 35 estimates in a Bloomberg News survey. European companies are struggling to pass on higher costs as budget cuts undermine consumer sentiment just as global export demand weakens. Copyright 2012 The Indian Express Online Media Pvt. Ltd., distributed by Contify.com Credit: (c) 2012 The Indian Express Online Media Pvt. Ltd., distributed by Contify.com |