One lackluster year shouldn’t spoil the whole bunch. After years of impressive performances and record highs, shares of Apple (NASDAQ:AAPL) lost momentum and posted an underwhelming return last year, especially compared to the broad market. The usual barrel of criticism was rolled out to justify Apple’s underperformance, but there are at least five major reasons to keep buying the world’s most valuable public company.
As Gordon Gekko says, “It’s all about bucks, kid. The rest is conversation.” At the end of the day, one of the most crucial elements of running a successful business is the ability to earn a profit, which Apple does quite well. Over the past few years, Apple has reported some of the biggest quarterly profits in history. Its only rivals in the record books are oil and gas companies.
Apple’s impressive profit history has allowed it to accumulate an unprecedented amount of cash. In the quarter ended March 29, 2014, Apple’s total position of cash and equivalents, short-term investments, and long-term investments totaled $150.6 billion. That cash pile is more than the entire market capitalization of Hewlett-Packard, Netflix, Best Buy, Twitter, BlackBerry, and Pandora combined. Apple’s cash pile actually declined for the first time since at least 2008 this year, but it was due to cash being returned to shareholders.
Along with the quarterly results, the tech giant announced it would return over $130 billion to shareholders by the end of 2015. Apple raised its share repurchase program to $90 billion from $60 billion, and hiked its dividend by 8 percent. Apple also plans to increase its dividend on an annual basis. With annual payments of $11 billion, Apple is one of the largest dividend payers in the world.