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Apple Inc. shares approach ex-dividend as it gears up to distribute $2.8 billion to shareholders [u]

On February 12, Apple will pay shareholders of record a quarterly dividend of $0.47 per share, but investors will need to buy shares by February 5th (to have settled ownership of the company's stock by the market's close on February 9) in order to qualify.

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Apple has been paying its shareholders a dividend about a month and a half after the end of each fiscal quarter ever since it declared its modern dividend plan in the summer of 2012.

The February dividend will be the third to occur since the company issued a 7-for-1 stock split. That split also converted the dividend from $3.29 per share to 47 cents per share.

Following its stock split, Apple repurchased a surprising $17 billion of its own stock in the September quarter and an additional $5 billion of stock in open market purchase during its December quarter (Apple's Fiscal Q1 2015). The company now has 5.825 billion shares outstanding.

Apple shares outstanding Q1 2015


Since the beginning of 2014, Apple shares are up 48.28 percent, compared to Microsoft's 11.56 percent gain or Google's 5.25 percent decline in nonvoting GOOG C class shares and 4.73 percent loss in standard GOOGL A class shares.

Since the start of 2015, Apple shares are up 7.49 percent, compared to Microsoft's 10.43 percent loss or Google's 0.54 percent gain in nonvoting GOOG C class shares and 0.5 percent gain in standard GOOGL A class shares. Google split its shares into the two classes and awarded investors one of each, effectively stripping investors of half their voting rights through the "dividend" dilution.

Apple MSFT GOOG Q1 2015


AAPL Dividends & Buybacks



Dividends are a minority portion of Apple's shareholder capital return program, the majority of which has been earmarked for buying back outstanding shares.

Capital Return AAPL Q1 2015



Buybacks increase the scarcity, and therefore value, of Apple's stock by taking shares off the market and retiring them. Removing shares from circulation also enhances the company's closely-watched earnings per share metrics. Over the last four quarters, Apple has repurchased $45 billion worth of its stock off the market or via accelerated repurchase programs.

The repurchase of shares has slightly reduced the total dividend Apple pays. While the company reports $2.8 billion in dividend payments for FQ1, at $0.47 per share the 5.825 billion shares outstanding would appear to total $2.73 billion, a $70 million reduction over the previous quarter's dividends.

"The Company also plans to increase its dividend on an annual basis, subject to declaration by the Board of Directors," Apple states in its 10-K filing.

Over the past calendar year, Apple has paid out $11 billion in dividends to its shareholders, distributing about $2.8 billion every quarter, although that number is dropping in tandem with buybacks.

Apple's volume of stock buybacks have also now reached the 5 percent threshold to qualify for inclusion in the "NASDAQ BuyBack Achievers Index," as well as the PowerShares Buyback Achievers Portfolio, as noted in a report by ETFtrends.

In total, Apple has spent $72.9 billion on stock buybacks since initiating its capital return program, including an opportunistic $14 billion share grab initiated after the stock plunged more than 8 percent last January following the company's holiday Q1 release which detailed its highest ever quarterly revenues and operating profits--results that the tech media depicted as "disappointing."

Combined with dividend payments and net share settlements, Apple has spent $102.7 billion on capital return since mid 2012, but still holds over $178 billion in cash.