Monday, August 13, 2012

A Record After Sixteen Years

Apple today quietly marked a financial milestone. Shareholders of record will be paid $2.65 per share next Thursday, the first dividend in 16 years. The amount may seem small, but the payout of 0.42% ($2.65 / $630) per quarter is substantially higher than the 0.05% earned on my Bank of America passbook account (B of A would pay 8 cents per quarter on a $630 savings account balance).

An investor in Apple, of course, is also subject to the risk that the stock price would decline, and recovery of a new investment in Apple shares is much less certain than cash from an insured savings account.

On balance, your humble observer thinks that the stock price and dividend payout will continue to grow. But Apple shares already having risen 53% this year, there are no guarantees. That's why the British often refer to stock-market investing as punting. © 2012 Stephen Yuen

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