Sometime in April, analysts believe that Apple will be announcing an increase in stock buybacks. For those that trade Apple, knowing how this will affect the price of its stock over the short term is a must. It’s also important to know at what price levels this will actually have a tangible impact upon the price of stock.
There are a lot of other factors besides buyback amounts that go into this impact. For example, how much of an influence will Apple’s declining iPhone shipments have on this? Also, Apple is expected to raise their dividend amounts at their next earnings release. Analysts think that this could be anywhere from a 5 to 10 percent increase. A dividend increase will hurt stock prices short term, and the higher the percentage, the bigger the impact. That is, unless larger dividends end up bringing more long term value investors to the company. That might be one of the things that management is aiming for, as it would decrease volatility in the stock like what was seen in the last half of 2015. Continue reading