Apple Inc. (AAPL) Deserves a Place in the Dow

The Dow Jones Industrial Average (INDEXDJX:.DJI) includes 30 of the most prestigious U.S. companies in the world, with most of them leaders in their respective fields. Yet the Dow doesn’t include Apple Inc. (NASDAQ:AAPL) — the biggest company in the world throughout most of 2012 and still the biggest technology company by a wide margin. Here are just a few of the many reasons Apple Inc. (NASDAQ:AAPL) deserves to take its place in the Dow.

1. A dominant brand.
Apple Inc. (NASDAQ:AAPL) has done an amazing job of bolstering its brand presence around the globe in recent years. Just last year, Interbrand ranked Apple Inc. (NASDAQ:AAPL) as the second most valuable brand in the world, finishing second only to The Coca-Cola Company (NYSE:KO) and earning the distinction of seeing its brand value more than double in just a single year to more than $76.5 billion. By demonstrating its desire to give people exactly what they want — often before they even know it — Apple Inc. (NASDAQ:AAPL) has captured a nearly fanatical loyalty among many of its customers.

Source: Apple Press Info.

2. A lucrative dividend.
Every stock in the Dow pays a dividend, but until recently, Apple Inc. (NASDAQ:AAPL) didn’t. Last year, though, Apple paid its first quarterly dividend in 17 years, and its 2.5% dividend yield equates to about $10 billion in dividend payments to shareholders on an annual basis. Apple has clearly established itself as a stock not only for growth investors but for those seeking income as well.

3. A history of product innovation.
The company that created the iPod, iPhone, and iPad has revolutionized the way people deal with computing devices. Some question whether the death of Steve Jobs put a halt to Apple’s innovative tradition, but Apple hasn’t stopped seeking new ways to bring valuable and exciting products to market, and the company has retained its top ranking from management consultant Booz & Company despite spending a fraction of what competitors Samsung and Microsoft Corporation (NASDAQ:MSFT) pay for research and development.

Source: Apple Press Info.

4. The ability to split its stock.
The reason most often cited for Apple’s not being in the Dow is that its share price so high that it would create a severe imbalance in the price-weighted average. Yet while Apple hasn’t split its stock lately, it has done so in the past, with its most recent split coming in 2005. If a spot in the Dow were on the line, CEO Tim Cook would probably jump at the chance to do a stock split.

5. The perfect opportunity for the Dow to add a stock at a cheap valuation.
The Dow has historically had a mixed track record in its timing in adding new companies. It added Microsoft Corporation (NASDAQ:MSFT) near its tech-bubble peak, as the stock performed dismally during the ensuing tech bust. But with Apple now 40% off its highs, the managers of the Dow have a chance to avoid the buy-high mentality that it has sometimes used before.

Get Apple into the Dow!
Many Apple hecklers will undoubtedly argue that the company’s best days are behind it. Yet because of both its past accomplishments and its potential for growth well into the future, the Dow would be well served by admitting Apple to its ranks.

The article Apple Deserves a Place in the Dow originally appeared on Fool.com.

Fool contributor Dan Caplinger owns shares of Apple. You can follow him on Twitter: @DanCaplinger. The Motley Fool recommends Apple and Coca-Cola and owns shares of Apple and Microsoft.

Copyright © 1995 – 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.

Comments
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 52 percentage points in 24 months. Our beta is only 1.2 (don't click this link if beating the market isn't important to you).

Lists

The 10 Largest Pharmaceutical Companies In the World

The 10 Most Expensive Android Apps

The 9 Most Expensive Designer Bags in the World

The 7 Most Expensive Real Estate in the World

The 10 Most Expensive eBay Items Ever Sold

The 10 Most Expensive iPhone Apps

The 9 Most Expensive Designer Shoes in the World

The 10 Most Expensive Cigarette Brands

The 10 Most Expensive Law Schools in the US

The 10 Best Wall Street Movies

The 10 Most Expensive Golf Clubs Ever Sold

The 10 Most Expensive Golf Memberships

The 10 Best Disney Characters Ever Created

The 8 Best Foods for Gaining Weight

The 10 Most Expensive Colleges in the World

The 7 Most Memorable Ad Campaigns of All Time

The 7 Most Expensive High Schools in the World

The 10 Electric Vehicles with the Longest Range

The 10 Cities with the Worst Drivers in the World

The 10 Most Expensive Dresses Ever Created

10 Islands to Visit Before You Die

10 Famous Celebrities Who Needed Rehab

The 15 Countries with the Largest Oil Reserves

The 10 Most Overused Excuses in the World

The 5 Best iOS Apps You Can’t Get on Android

5 Companies Damaged By Social Media Blunders

The 10 Most Legendary Blues Songs

The 10 Most Lawless Places in the World

4 Reasons China is a Threat to the US

The 17 Most Sugary Drinks in the World

The 10 Most Ruthless Rulers in History

The 10 Greatest Generals in History

Top 8 Travel Destinations for 2015

The 10 Safest Dog Breeds for Children

The 10 Most Stolen Vehicles in the US

The 7 Most Expensive Celebrity Weddings

The 10 Best LoL Teams in the World

Top 10 Worst Marketing Campaigns Ever Produced

Top 5 Diets that Help You Lose Weight

The 10 Best Ways to Stay Awake

7 Artists That Switched Musical Genres

The 10 Most Expensive Cities to Live in New Jersey

The 10 Best High Schools in New York

The 10 Countries With the Least Gender Inequality

The 6 Biggest Musician-Manager Feuds

The 10 Countries with the Cheapest Gas Prices

The 7 Most Theatrical Bands of All Time

The 8 Worst Band Breakups of All Time

The 10 Most Important South American Leaders

The 7 Most Successful Casting Show Winners

Subscribe

Enter your email:

Delivered by FeedBurner

X

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 47.6% in its first year! Wondering How?

Download a complete edition of our newsletter for free!