Experts: Watch Apple's 'Cash Cow,' Position Of Technical Strength During Earnings
Apple Inc. (NASDAQ: AAPL) reports earnings on Monday afternoon, and is the focus of the equity world.
In interviews with Benzinga, two experts discussed what they're watching when the company reveals its second quarter numbers.
Thomas Carr, CEO of Dr.Stoxx.com, said he'll be tracking Apple's cash. "While all eyes will be on Apple's iPhone sales, mine will be on what Tim Cook plans to do with the $180 billion cash cow his company is sitting on," he said.
"At a paltry 1.4 percent yield, Apple pays the lowest dividend of any Dow Jones company, and well below the 2 percent average of dividend-paying S&P companies.
"Since Cook is on record as saying he doesn't want to be a 'cash hoarder,'" he added, "shareholders are justified in having their hands out."
Carr said he'd prefer to see a 20 percent dividend boost to an annual payout of $2.25, with a verbal commitment to regular increases.
Technical expert Rod David, meanwhile, talked about Apple's chart.
"Apple is greeting earnings from a position of strength, somewhat similar to last earnings -- a pullback from new highs has avoided dipping under prior highs, or under critical support at 122," he said. His long-term target is $140; Apple currently trades near $132.
That's where the most risk is, David added. "Consolidation since February's high has formed my proprietary 'uptrending interim correction' pattern, which tends to precede a rally's final thrust before collapsing."
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