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Can Apple Continue to Increase Shareholder Value?

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Dec. 23 2016, Updated 9:06 a.m. ET

Significant rise in share price since IPO

Apple (AAPL) went public 36 years ago in December 1980. In the 1980s, Apple stock rose 199.0%, driven by the sale of Macintosh. In the 1990s, the stock rose 191.0%, in spite of several problems the company was facing. A court decision made Apple transfer part of Macintosh’s intellectual property to tech heavyweight Microsoft (MSFT). Apple co-founder Steve Jobs returned to Apple and sparked a new cycle of growth and innovation in the latter half of the decade.

Despite the dot-com bust in early 2000, Apple continued to invest in devices such as the iPod, and it launched the first iPhone in that decade. Apple repeatedly beat analyst estimates, driven by impressive iPhone sales. By the end of the 2000 decade, Apple stock had risen more than 660.0%.

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In the last few years, Apple started a comprehensive share buyback program and started paying dividends to its investors. Although Apple has faced competition in the smartphone segment from companies such as Samsung (SSNLF) and Google (GOOG) (GOOGL), it’s still confident it can create a complete ecosystem for Apple users.

Apple has created a huge market for its products, primarily driven by a loyal customer base. But falling sales in China in the last three quarters have negatively impacted the company’s revenue. A stagnant PC (personal computer) environment and low growth in the smartphone segment have also impacted its revenue.

Since Apple went public in 1980, the stock has risen more than 18,000.0%.

Apple announced $250.0 billion share buyback program

Apple stated that it has completed $186.0 billion of its $250.0 billion ongoing capital return program. Taking past returns into consideration, Apple plans to pay shareholders $250.0 billion by the end of March 2018. In fiscal 4Q16, it returned $6.0 billion in share repurchases and $3.1 billion through dividends to shareholders.

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