A recent report in
claimed that if Apple (NASDAQ:
) doesn't change its ideas towards dividends or buybacks, or finds
something else to do with its cash, by the end of 2013 it could
reach $170 billion.
According to Moody's, "Unless Apple changes its philosophy
towards liquidity/shareholder returns by increasing its $10 billion
annual common dividend, or if Apple increases it stock buyback
program, we estimate Apple's cash balances could increase by
another $35 billion in 2013 and exceed $170 billion,"
Wall Street has a way of taking a piece of information and
talking it to death. By now, investors have heard about Apple's
cash position but for most people, wrapping their head around the
size of it is difficult. People don't have 170 billion of anything
so here's some perspective.
First, there is no company even close to having as much cash as
Apple. Number two on the list is Microsoft (NASDAQ:
) who has $68.3 billion. (Yes, Apple has twice as much) Number
three is Google (NASDAQ:
) with $48.1 billion, and then Pfizer (NYSE:
) with $46.9 billion. Finally, rounding out the top five is Cisco
) with $46.4 billion.
Let's look at the enormity of $170 billion.
If Apple were to use all of its projected cash to purchase Ford
) Explorers, it could buy 5,841,924. That's one for every citizen
in the state of Wisconsin.
If sports is Apple's thing, it could build 148
Dallas Cowboy Stadiums
, without the scoreboard hanging so low that footballs hit it.
If it wanted to take on a humanitarian cause, the cash could
feed every hungry person in the world three basic meals per day for
245 days based on the
most recent statistics
The real estate market is rebounding. Maybe Apple wants to put
its cash to work like many other investors by purchasing homes and
becoming landlords. The company could buy 850,000 homes with its
cash, based on a value of $200,000.
But maybe something more traditional like M&A is a better
way to use the cash. Here's a small list of the notable companies
Apple could write a check for if it reaches $170 billion based only
on market cap.
Anheuser-Busch InBev (NYSE:
) Citigroup (NYSE:
) Verizon (NYSE:
) Bank of America (NYSE:
) BP (NYSE:
) Visa (NYSE:
Finally, if it wanted to provide a top-of-the-line iPad to the
masses, two thirds of all United States citizens would find a nice
surprise in their mailbox.
Convinced yet? $170 billion is a lot of cash!
(Disclaimer: these are estimates based on general assumptions.
As everybody knows, nothing on Wall Street is this simple.)
(c) 2013 Benzinga.com. Benzinga does not provide investment
advice. All rights reserved.
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