Sterne Agee on Apple: Will Continue to Outperform

Sterne Agee has published a research report on Apple AAPL after this morning's dividend and stock repurchase program announcements. In the report, Sterne Agee writes, "The $15 billion in annual payments that AAPL would need for dividend payments and stock repurchases may sound like a lot but we believe the company's strong profitability and cash flow could easily fund. As we said before, we estimate that AAPL will likely generate $75-80 billion in free cash in the next four quarters vs. the $45.3 billion the company generated in the previous four quarters. We estimate $15 billion would amount to 35%-40% of its U.S. free cash flow leaving enough room to invest in other things including R&D, store openings, and its global supply chain." Sterne Agee maintains its Buy rating and $620 price target on Apple, which is currently trading up $11.13 from Friday's $585.57 closing price.