For Two Quarters' Dividends, Apple Could Buy 77% of Netflix
Apple announced today it would begin paying a $2.65 quarterly dividend.
Cost of dividend: 932.4M shares outstanding * $2.65/quarter/share = $2.47B/quarter
Cost of a majority stake in Netflix*: $6.36B market cap / 2 = $3.18B
For two quarters’ dividends, Apple could buy 77% of Netflix.
This dividend is good PR and CNBC fodder, but as an investor I’d prefer my investment be invested.
* My intent is to illustrate what Apple could do with this much money. Even if you don’t think Netflix would provide enough strategic value to justify a buyout, the point remains that there are large, competitive, growing companies that Apple could invest in.