Apple Inc. (AAPL) Needs to Expand Its ‘Investor Base’: Analyst

There are many theories circulating about what shares of Apple Inc. (NASDAQ:AAPL) will do next, but one analyst was on CNBC earlier today discussing–in his opinion–why investors should still be bullish. Topeka Capital Markets’ Brian White, who is widely known for his Apple price target once in excess of $1,000, has lowered his outlook to $888. Still, this figure represents a 95% upside from current levels. Let’s get into the details of why White still holds this optimistic sentiment.

Apple Inc. (AAPL)

On Apple Inc. (NASDAQ:AAPL)’s investment outlook at the moment, White called the latest sell-off a “slippery slope,” adding that “it’s the outlook that people are concerned with.” The analyst also mentioned the following:

“These guys have the best product portfolio, and that has not changed. There’s very exciting things on the horizon [...] Apple TV, China Mobile. You know what they need to do is tap into this cash balance in a major way. So, a dividend, that’s much higher than we currently have. And we’ve said $3.75 to $5.00 per quarter versus $2.65. And a $10 billion buyback over three years, why don’t we do a something $100 billion over five years?”

At the end of the first quarter, Apple Inc. (NASDAQ:AAPL) shared that it now has $137 billion in cash, though our analysis shows that just a fraction of this hoard is available in in cash, cash equivalents, and short-term marketable securities. Still, the company has the capacity to boost its dividend if it so desires.

At a PEG near 0.5 and a forward P/E close to 9.0x, it’s clear that value-investors are attracted to this stock, but White discusses how a “sustainable dividend” increase would benefit the company by “expanding its investor base.” In his own words, White says that “distributing more cash” would obviously help, and it makes sense. Logically speaking, a higher yield would pull more income-seeking investors into Apple Inc. (NASDAQ:AAPL).

With a projected dividend yield near 2.1%, Apple offers a significantly smaller payout than other tech mega-caps like Intel Corporation (NASDAQ:INTC) and Microsoft Corporation (NASDAQ:MSFT), who yield 4.2% and 3.3% respectively.

Let us know your thoughts on Apple in the comments section below, and for more coverage, continue reading here at Insider Monkey:

Almost Every Apple Investor is Misunderstanding This Simple Fact

Apple: Cut Losses, Hold, or Double Down?

Apple Jumping Into the Shoe Industry?

Disclosure: I have no positions in any of the stocks mentioned in this article

Biotech Insider Alert - $6 Stock To Hit $40

$200 Million Dollar Healthcare Hedge Fund's #1 Best Idea Right Now

The best healthcare hedge fund out there right now is one of the largest shareholders in this biotech stock. The fund returned more than 20% in each of the last 2 years with a virtually fully hedged portfolio, and it's sending out a BUY signal on this biotech stock. Get your FREE REPORT today (retail value of $300)

This is a FREE report from Insider Monkey. Credit Card is NOT required.
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 Greatest Directors in the World

Largest Animals in the World

World’s Most Expensive Desserts

Best Selling Comic Books of All Time

A-list Actors who Sabotaged Their Career

Rappers With a College Degree

The Best Jazz Albums of all Time

The Most Influential Jazz Musicians

The World’s Most Famous Photographers

The Best Oscar-Winning Songs

Most Influential Choreographers Ever

Most Expensive Department Stores in the World

The Most Expensive Stolen Paintings in the World

The World’s Most Expensive Teas

Top Oscar Record Holders

The Most Expensive Flowers in the World

Countries With a Booming Film Industry

Most Expensive Cupcakes in the World

Uncommon European Escapes

The Most Stolen Artists in History

Best Travel Destinations in Australia

World’s Most Expensive Musical Instruments

World’s Most Famous Animals

Most Expensive Cakes in the World

Most Expensive Kosher Champagne in the World

Most Expensive Kosher Wine in the World

The Most Surprisingly Dark Fairy Tales

Most Popular Travel Destinations in Asia

The 10 Most Expensive Dresses Ever Worn to the Oscars

World’s Most Visited Art Museums

Best Countries for Photographers to Work in

Best Paid Jobs in the Film Industry

The Most Renowned Recovered Paintings Ever

Child Stars That Turned out Just Fine

Books That Were Banned in the Past Century

World’s Richest Dancers

Best Remedies against Bad Breath

Foods That Improve Your Skin Texture

Best-Selling Children’s Books of all Time

Foods That Boost Your Libido

Best-Selling Books of all Time

The Most Expensive Academy Awards Jewelry in History

Most Expensive Japanese Restaurant In New York City

The Best B-Boy Movies

Most Awesome Hip Hop Documentaries

Foods That Stain Your Teeth

Richest Doctors in the World

The Best Movie Sountracks Ever

The Highest Grossing Musicals on Broadway

The Most Successful Reality TV Stars

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 129% in 2.5 years!! Wondering How?

Download a complete edition of our newsletter for free!