3 Potential Catalysts for Apple Inc. (AAPL) This Year: China Mobile Ltd. (ADR) (CHL)

Returning cash the easy way
The last potential 2013 catalyst is a decision by Apple to return more cash to shareholders. Einhorn’s preferred stock plan seems convoluted and will probably drive up transaction costs for individual investors. Sometimes, simple is the best strategy. Apple could (and should) raise its quarterly dividend from $2.65 to $3.50-$4.00. This would bring the yield above 3%, which would attract more income and value investors. Apple will pay its third quarterly dividend this week, so a dividend increase is most likely after the May payout.

While I would also like to see a larger share repurchase to soak up some of the $137 billion on Apple’s balance sheet, that will probably have to wait until the U.S. lowers repatriation taxes. Even without an expanded buyback, there are still at least three potential catalysts that could drive Apple higher this year. David Einhorn’s financial engineering should not be necessary to unlock shareholder value.

The article 3 Potential Catalysts for Apple This Year originally appeared on Fool.com and is written by Adam Levine-Weinberg.

Fool contributor Adam Levine-Weinberg owns shares of Apple. The Motley Fool recommends Apple. The Motley Fool owns shares of Apple and China Mobile.

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