Investors to Target Cash at AAPL Shareholder Meeting

| Apple Stock Watch

Apple shareholder meeting questions may focus on investor payoutsApple's annual shareholder meeting is scheduled for Wednesday morning at the company's Cupertino headquarters, and this year may see executives facing more pressing questions thanks to a lawsuit that successfully blocked a planned vote on whether or not preferred stock options should require shareholder approval.

The lawsuit was filed by hedge fund investor David Einhorn and his Greenlight Capital because he feels Apple should be giving back more money to investors and that preferred stock is the way to go.

His lawsuit targeted the fact that Apple had planned on including the measure on a ballot along with two other topics, which he claimed violated U.S. Securities and Exchange Commission rules by bundling multiple proposals into a single vote. Judge Richard Sullivan ultimately agreed and even went so far as to grant an injunction blocking a vote on that particular measure.

Apple CEO Tim Cook called Mr. Einhorn's lawsuit a "silly sideshow," and questioned why he would want to block a vote on "something that's good for shareholders." Mr. Cook said that by requiring shareholder approval before issuing any preferred stock options, Apple was adding accountability instead of leaving the door open for executives to issue what he said amount to blank check shares.

What Mr. Einhorn is hoping for from Apple is a perpetual quarterly payout of US$0.50 per preferred share, and called his Gobstopper stock the "iPref."

"This is not complicated, it's merely unfamiliar," he said. "Here's the product that Apple doesn't yet know it needs."

The controversy he stirred up will likely play out, at least to a degree, during the shareholder meeting this morning with questions from attendees. Apple has become somewhat more straightforward with its responses to investors, journalists, and the public over the past year, so it's possible we'll get some clear answers about what the company has planned -- but don't expect any surprise announcements about future product plans.

With over $137 billion in cash, some investors think it's time for Apple to give more back than they get through the company's new dividend program. At least a few of those people will be at today's shareholder meeting and will be expecting some answers.

Apple's stock is currently trading at $445.76, down 3.21 (0.72%).

Sign Up for the Newsletter

Join the TMO Express Daily Newsletter to get the latest Mac headlines in your e-mail every weekday.

3 Comments

Lee Dronick

“This is not complicated, it’s merely unfamiliar,” he said. “Here’s the product that Apple doesn’t yet know it needs.”

Apple doesn’t need the iGreed product.

What they should do with the cash is buy Adobe and clean up that mess of spaghetti code. Then the sell PhotoShop and the others in the App Store. They can continue to sell the pasta apps directly to Windows users.

Or use the cash to build more production facilities here in the USA.

skipaq

A 2 for 1 split maintaining the same dividend per share will effectively double the dividend while at the same time making the stock more attractive to investors. That would not impact Apple’s ability to make strategic purchases.

ctopher

I say keep on Hording until they’ve got enough to buy Apple. Then take it private. That’ll teach those hedge fund guys!

Log-in to comment