Apple: Dreams Die Hard

Over the past year Apple has fallen 27.51% while market averages have risen 10% or more.

There's no question that the past year has dissipated the aura of coolness that surrounded the ownership of Apple products or Apple stock. Last year's "new" product releases represented incremental improvements--some features were impressive, to be sure---but, alas, the revolutionary, industry-changing devices that were supposedly in the pipeline when Steve Jobs died appear to be a figment of the biographer's imagination.

Your humble observer is a long-time holder of AAPL and, like other investors, has been disturbed by the stock's 28% drop in price over the past year and 42%(!) fall from the $705 all-time high of last September. There are thousands of articles that have been written---and dozens since the 3/31/2013 quarterly earnings were released a few hours ago---about Apple's fall from grace, and I won't waste your time, dear reader, by rehashing points that have been made comprehensively and more eloquently elsewhere.

As for yours truly, it only took a few seconds to decide to hold on to my shares.

1) This quarter's dividend hike to $3.05 means that the stock is yielding 3% ($12.20 per year / $406 price per share), much higher than savings, money-market, or U.S. Treasury rates.

2) Of course the dividend is riskier than the aforementioned debt securities, but with a $145 billion cash balance (true, most of it is offshore, but it's still under Apple's control) the dividend is secure for years.

3) The dividend should appeal to the so-called "value" investors and/or "yield" investors, meaning the stock price has hit a bottom.

4) Underneath this hardened investor's carapace lurks the heart of the fanboy who hopes that there are shards of Steve's vision deep within Apple's labs. Yes, that may make me a bitter clinger, but the dividend makes the cost of holding on to the dream bearable, and dreams die hard. © 2013 Stephen Yuen