Ultra low rates ...
"The most interesting news last week was that Apple (AAPL) announced on Tuesday that it will boost its payments to investors by $55 billion to a total of at least $100 billion by the end of 2015, including $60 billion in stock buybacks and $40 billion in dividends. Here's a cash-rich company that is borrowing in the bond market because, if it repatriated its overseas cash to fund dividends, it would have to pay U.S. corporate income taxes on top of the foreign income taxes it already paid. To avoid "double corporate taxation," Apple has chosen to borrow in the bond market. Furthermore, since blue-chip U.S. companies can borrow at ultra-low rates, they can buy back their outstanding stock and boost their underlying earnings per share.
Apple is not alone, but it is now the leader of Corporate America's stock buyback revolution, since its $60 billion stock buyback program is much larger than Home Depot's (HD) $17 billion buyback plan, announced last February. The fact that Apple suddenly has a 2.7% dividend yield seems very bullish for Apple and the market. Clearly, Corporate America's dividend funding and stock buyback frenzy remains alive and well, which will likely put a firm foundation underneath the overall stock market, muting any future corrections."
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