Home Broker News This Stock Pays Billions In Cash Each Year: Apple

This Stock Pays Billions In Cash Each Year: Apple

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For some investors and traders, technology is a taboo sector due to the area’s volatility and for the reason it doesn’t provide huge cash flows. 

However, the pandemic has demonstrated that having some of these vital tech stocks in your portfolio is very important, even for long-term investors. When lockdowns,and other restrictions severely damaged traditional companies’ revenues, tech heavies rode the wave of success, since they provided services that helped modern life going. 

Keeping this in mind, you can always pick less volatile and more mature tech companies that pay growing dividends each year and fit well in any retirement portfolio. Let’s take a look at a stock that makes a good case for long-term investments and pays substantial dividends.

Apple 

Many traders and investors treat Apple Inc (NASDAQ:AAPL) as a tech stock with small dividend flow. However, we should remember that the creator of iPhones is one of the most cash-rich companies in the world, allowing it to please income-seeking investors.

Don’t be tricked by Apple’s present small 0.68% dividend yield. Apple is making big efforts to boost the total return for its investors in the form of growing dividends and a serious share buyback plan. Apple boosted its dividend by more than 10% in the past several years, except fiscal 2020, when it boosted the payout by 6%. Apple now pays $0.2 a share quarterly dividend.

Apple generated $3.28 in EPS for fiscal 2020. With a payout of $0.82 on an annual basis, this was 25% of its earnings, showing that it has plenty of room to hike its dividend each year.

While Apple has been increasing its dividend, it has also been buying back its shares. With $196 billion in cash on hand, Apple is in an enviable position to further increase its share repurchase program in order to support its shares. 

 

 

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