Joined Nov 11, 2007
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Rumor Has it $APPL Will Parcel Out a Special Dividend

“Apple stock just popped on a rumor that the company will dig into its mountain of unneeded cash and issue a big fat “special dividend” to shareholders.

On the one hand, this is a positive: Apple should do something with the cash.

On the other hand, it’s a negative: Of the three most sensible ways to return cash to shareholders, a “special dividend” is the least flexible and least efficient.

The two other options are:

  • Increase in the regular dividend (perhaps at least a doubling)
  • A major stock buyback

Of these two options, the stock buyback is the most efficient and flexible option.


Because of dividend taxes.

Apple’s stock is owned by a lot of small, taxpaying shareholders.

These shareholders will get hit with up to a 23.8% tax on any dividends thanks to the recent tax increase…..”

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