Apple Is Preparing to Borrow for Stock Repurchases, Dividends and Capital Increase

Apple plans to sell $ 14 billion worth of bonds, taking advantage of cheap borrowing costs to finance corporate transactions such as stock repurchases. According to the preliminary prospectus of the proposal announced in the SEC file, Apple (AAPL) is working to issue bonds in six parts. According to the report, after the 40-year collateral is evaluated between 115 and 120 basis points for the first time, it is foreseen to yield over 95 basis points from treasury bonds. Apple said the following in its preliminary share prospectus: “We plan to use this type of net income for the repurchases of our common stock, dividends to shareholders, financing for working capital, capital expenditures, acquisitions and repayment of debt.” According to Bloomberg Barclays index data, Apple can borrow on 1.86 percent for about nine years. This is lower than Apple's 1.94 percent in August.

According to Bloomberg Intelligence, Apple may need to increase annual shareholder returns to over $ 100 billion in the coming years to reach its net cash-neutral target.

Last week, Apple reported a quarterly growth of over $ 100 billion for the first time in its earnings report. But looking at the March quarter, Luca Maestri, the company's CFO, stated that the growing demand for digital services in the midst of deadlocks caused by the pandemic last year would be difficult to compare year on year. Maestri added that sales growth in the AirPod, wearables and accessories category is expected to slow in the second quarter. Following strong quarter results, Wedbush analyst Daniel Ives maintained the stock's Buy rating and price target of $ 175 (with a 30 percent upside potential). In a note to investors, Ives said, "We see ordering activity moving ahead of expectations. The previous model was a year the iPhone 11 gave the green light to fiscal year 2021. Investors are also focusing once again on service revenues that exceed expectations. This quarter is the 5G super cycle. We see it as the first beginning. '' Right now, the rest of Wall Street has a cautious and optimistic view of the stock. The Medium Buy consensus rating consists of 20 Buy, 6 Hold and 2 Sell. Meanwhile, after stocks gained 68 percent last year, analysts' average price target of $ 149.19 shows an 11 percent upside potential from current levels. Meanwhile, TipRank's measure fund trading tool shows that trust in Apple is currently very negative, as 27 hedge funds fell 38 million in the last quarter.   Apple Is Preparing to Borrow for Stock Repurchases, Dividends and Capital Increase Source: https://finance.yahoo.com/ You may also be interested in:

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