Greenlight Company Presentation
Large On-Going Share Repurchases
Assumptions
o Apple spends 100% of free cash flow after dividends on stock buyback
o Total cash on the balance sheet is held constant at $137 billion
o Domestic cash is used before foreign cash
o Starting in mid 2014, foreign cash is needed and used (repatriated)
o Use of foreign cash increases Apple's tax rate from 25% to 35%
Greenlight Capital, Inc.
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In the next alternative, Apple could keep its current cash balance, but use all of its future free cash
flow generation to buy back stock.
In this example we maintain the current dividend and freeze the cash on the balance sheet at $137
billion.
To fund the repurchase, we assume Apple uses its domestic cash until it runs out. Then it switches to
foreign cash, which will require it to pay taxes as needed in order to execute the repurchase program
and keep overall cash flat.
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