Technology companies such as Apple Inc. (NASDAQ:AAPL) are often assessed solely (or mainly) on their growth potential. Few investors consider the long-term value of a meaningful, growing, dividend.
Apple has been one of the best examples of how a mature blue-chip tech company ought to return value to shareholders, in my view.
The company’s small but meaningful dividend has continued to increase, even during this pandemic, with the company announcing last month both a dividend increase as well as a $50-billion increase to the company’s share buyback program.
These announcements came alongside a downward revision to quarterly guidance, and have largely been overshadowed (in my view) by larger concerns around global supply chains for the company’s core products as well as consumer demand for pricey gadgets as unemployment hits new highs not seen since the end of the Great Depression.
These concerns are certainly pertinent, and I’d recommend investors take them seriously. That said, Apple’s unique balance sheet strength allows for some serious leeway today.
Apple’s cash hoard which continues to balloon (and will likely be tapped due to this unforeseen macroeconomic event) was once viewed by many analysts and activist investors as unnecessary.
Today, Apple’s management team is getting a gold star from most of Wall Street, especially considering the recent decision by Apple’s management team to return more cash to shareholders over time.
Apple’s dividend, and long-term dividend growth potential, is simply another excellent reason investors should consider Apple stock.
Invest wisely, my friends.
