This $13,000 fine, to a company that generated over approximately $156.51 billion in 2012, would hardly be considered a slap on the wrist. However, the company better watch out as they will be fined an additional $65,000 if they are found violating the labor law again. What were they fined for? French law requires that employers release employees between 9 pm and 6 am unless the company provides social services, or the company is there to maintain economic activity. The Apple Inc. (NASDAQ:AAPL) stores were open until 9:00 pm, but kept employees until 11:00 pm for cleaning and organization purposes. Yes, that additional $65,000 potential fine is equivalent to $0.021 of the average American household income, but that is the “threat” that Apple was given.
Ok, so maybe Apple will not work its employees between those hours again, but I don’t think it’s the fine that will stop them. After all, the company’s gross profit for 2012 was well over $68.6 billion (43.9%). Apple’s market cap has grown 545% since 2008, and currently holds a 11.2% Free Cash Flow, or FCF, yield. I don’t know how low the stock will drop and honestly won’t make a prediction as there are so many variables, but Apple Inc. (NASDAQ:AAPL) does show promising metrics in virtually every area besides its stock price.
With revenues in excess of $73.7 billion, Microsoft Corporation (NASDAQ:MSFT)’s fine would have been equivalent to $0.009 to an average American’s annual income. However, Microsoft wasn’t fined by a Paris court and will be able to keep its full $27.6 billion in FCF. Gross margins for the company are a remarkable 76.2%, which led to approximately $56.2 billion in gross profit. Microsoft’s earnings per share, or EPS, have risen seven of the past ten years (Apple’s EPS have risen ten of ten, by the way), but dropped from $2.69 to $2.00 in 2012. Finally, Microsoft Corporation (NASDAQ:MSFT)’s FCF yield is 11.8%.
As I try to get a grasp the idea of how $13,000 will keep any company from working an extra few hours to keep a clean store, I will look at Research In Motion Ltd (NASDAQ:BBRY). BlackBerry holds a market cap of only $7.6 billion, and therefore a fine would have a larger affect. Had BlackBerry been fined, it would have equated to a whopping $0.085 fine for the average American household. The company acquired $18.5 billion in 2012 revenues, and shows a 35.7% gross margin. The stock was down over 18% in 2012, but has increased nearly 13% YTD. BlackBerry also seems to be cheaply priced as it shows a FCF yield of 10.85%.
Finally, Hewlett-Packard Company (NYSE:HPQ) would have received the equivalent of a $0.0055 fine to the average American household. Again, it wouldn’t have had a major effect on any household, let alone a company of HP’s size. With a market cap of $41.4 billion, the company shows an outstanding current FCF yield of 20.5%. Earnings per share have also risen seven of the past ten years, like Microsoft Corporation (NASDAQ:MSFT). The company’s gross margins are 23.2%, and company’s stock has increased an incredible 41.3% YTD. Even with this remarkable stock increase, the stock is down over 1% since the beginning of 2012. While Hewlett Packard shows a FCF yield that is 9.65% higher than Blackberry, both companies offer value for bargain investors.
The Foolish Bottom Line…
All of these companies seem to be cheaply priced, with HP leading the pack. My biggest concern for Apple Inc. (NASDAQ:AAPL)isn’t the fact that they received $13,000 in fines, but rather my concern is how the public will receive this news. With the stock dropping nearly 17% YTD, will this cause even more skeptics for the company? In order to keep a good public appearance, Apple might want to consider releasing its employees at 9 pm, or stay open until 11 pm. For bargain investors, all of these companies seem to be excellent investments at this time.
The article Fined For Working Late? originally appeared on Fool.com.
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