Apple’s Historic Buyback Keeps Investors Captivated
Apple Inc. has shelled out more than $550 billion buying back its own shares over the past decade, more than any other US company, and the technology juggernaut shows no signs of slowing down.
Even with the stock under pressure the past few days because of production delays for its newest handsets, Apple has fared better than other megacap tech companies in this year's bear market. Solid earnings and generous buybacks have become a central part of the investment thesis, making the stock more attractive during turbulent times.
Shares fell 0.4% on Tuesday.
“That's how they get the safe haven, the gold standard view from investors,” said Gene Munster, who covered Apple during a 21-year career as an analyst before co-founding venture-capital firm Loup Ventures. “When they just keep showing up and generating the kind of cash they do and buying their own stock back, it sends a strong message and I think they'll continue to do that as much as they can.”
The next signpost for investors about Apple's appetite for its own stock will come in April, which is when the company typically tops up its repurchase authorization. It's added $90 billion to the program in each of the past two years. It's still generating the earnings to replenish its bank account: It was the only megacap to rally in the wake of its results this quarter, and the report kept analysts from dramatically slashing estimates, in contrast to widespread cuts at its peers.
Even with economies slowing around the world, demand is still strong for Apple's most expensive iPhones, analysts say. The problem now is manufacturing delays because of Covid lockdowns in China, leading to what analysts say are record wait times for deliveries just as the holiday shopping season kicks
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