Your Survival Guy

Preparing your investments and family for when disaster strikes.

Disclosure

  • Home
  • Your Survival
    • EMP Threat
    • Tucker Explains
    • Newport Gas Outage
    • Water
      • Emergency Water Storage
      • Let There Be Water
    • Get Your Gun and Your Training Now
    • Satellite Phones
    • Navy SEAL Survival Kit
  • Your Money
    • Coronavirus Infects Stock Market
    • Looking for a Better America
    • You Invest, They Win
    • Where to Keep Your Cash
    • Paris
    • How to Buy a Boat
    • Dead or Alive? The Future of Long-Term Investing
    • Is Vanguard too Big?
    • Cryptocosm and Life After Google
    • The Last Intelligence Report
    • The Truth Behind the S&P 500
    • RAGE Gauge
    • How Many “Retirees” Will Keep Working?
    • Your Retirement Life
    • You’ll Love This if You’re Dreaming of an Active Retirement Life
  • Weapons
    • Self Defense
    • Every Family Should Own at Least One Shotgun: Here Are Three
  • About Me
    • Preparing for Times Like These
    • My Videos/Pics
    • Music
      • RIP Neil Peart: You Will Always Be Remembered as a “Modern-Day Warrior”
  • You
    • Our Cabin on Kodiak, Alaska
    • If You Are in Pain, this May Help. It Helped Me.
    • How to Save for a Grandchild
    • FIRE! Financial Independence, Retire Early
    • Compound Interest
    • Arithmetic of Portfolio Losses
    • Maximum Portfolio Withdrawal Rate
    • An Efficient Frontier
    • Retirement Compounders
    • Counterbalanced Total Returns
  • Survive & Thrive
    • January 2021
    • December 2020
    • November 2020
    • October 2020
    • September 2020
    • August 2020
    • July 2020
    • June 2020
    • May 2020
    • April 2020
    • March 2020
    • February 2020
    • January 2020
    • December 2019
    • November 2019
    • October 2019
    • September 2019
    • August 2019
    • July 2019
    • June 2019
    • May 2019
    • April 2019
    • March 2019
    • February 2019
    • January 2019
    • December 2018
    • November 2018
    • October 2018
    • September 2018
    • August 2018
    • July 2018
    • June 2018
    • May 2018
    • April 2018
    • March 2018
    • February 2018
    • Welcome

Warren Buffett and Apple Paying a Dividend Would Be Nice

May 16, 2017 By E.J. Smith - Your Survival Guy

“It’s our job, though, to over time deliver significant growth, bumpy or not. After all, as stewards of your capital, Berkshire directors have opted to retain all earnings,” writes Warren Buffett in his 2016 Annual Report Chairman’s letter. In other words, Berkshire doesn’t pay a dividend. It retains all earnings to invest in its companies or to acquire new ones.

If you’re a Berkshire shareholder and need retirement income you need to rely on Berkshire’s capital gains to sell shares. I don’t like that and it’s not how Mr. Buffett operates. He loves cash and invests it wisely (most of the time). But is this the best way to treat long-time shareholders? I’m talking about the ones who could use some retirement income. Why not reward them with some dividends?

Another point I’ll make is that Berkshire owns Apple. You can just hear the chorus: “Well, if Buffett owns it then it must be good.” I don’t like that. It’s a “coast is clear” statement, when in reality if you look on page 114 of the latest letter, it’s a tiny position for Buffett. The indexing crowd’s position in Apple, in percentage terms, truly makes Buffett look like a minority shareholder. Yes, Buffett has increased his position in Apple from last year by a significant amount, but what else can he easily buy with $20 billion in cash? “Too big to succeed” comes to mind.

The indexing crowd’s position in Apple, in percentage terms, truly makes Buffett look like a minority shareholder.

Apple, by the way, is sitting on a quarter billion in cash and their tiny dividend is a joke. Does anyone believe they will invest that cash with the expertise of a Warren Buffett? Not if their newly constructed headquarters is a guide to their capital allocation skills.

There are times when paying dividends make sense. Contrary to what Buffett or Apple may believe, I have found that shareholders are pretty good at spending their own money. They don’t mind receiving a hefty dividend year after year. They could use some of those retained earnings.

The following two tabs change content below.
  • Bio
  • Latest Posts
My Twitter profileMy Facebook profileMy Instagram profile

E.J. Smith - Your Survival Guy

E.J. Smith is Founder of YourSurvivalGuy.com, Managing Director at Richard C. Young & Co., Ltd., a Managing Editor of Richardcyoung.com, and Editor-in-Chief of Youngresearch.com. His focus at all times is on preparing clients and readers for “Times Like These.” E.J. graduated from Babson College in Wellesley, Massachusetts, with a B.S. in finance and investments. In 1995, E.J. began his investment career at Fidelity Investments in Boston before joining Richard C. Young & Co., Ltd. in 1998. E.J. has trained at Sig Sauer Academy in Epping, NH. His first drum set was a 5-piece Slingerland with Zilldjians. He grew-up worshiping Neil Peart (RIP) of the band Rush, and loves the song Tom Sawyer—the name of his family’s boat, a Grady-White Canyon 306. He grew up in Mattapoisett, MA, an idyllic small town on the water near Cape Cod. He spends time in Newport, RI and Bartlett, NH—both as far away from Wall Street as one could mentally get. The Newport office is on a quiet, tree lined street not far from the harbor and the log cabin in Bartlett, NH, the “Live Free or Die” state, sits on the edge of the White Mountain National Forest. He enjoys spending time in Key West and Paris. Please get in touch with E.J. at ejsmith@yoursurvivalguy.com
My Twitter profileMy Facebook profileMy Instagram profile

Latest posts by E.J. Smith - Your Survival Guy (see all)

  • Smith Family Robinson in Live Free or Die, NH - January 19, 2021
  • Are $2,000 Checks Going to Rebuild NYC? - January 15, 2021
  • The Fed is Sacrificing Retirees to Save the Banks - January 15, 2021
  • How Are You Doing on a Local Level? - January 14, 2021
  • February RAGE Gauge: Americans Focusing on What’s In Front of Them - January 14, 2021

If you enjoyed this post, email it to a friend:

  • Email
  • Print
  • Facebook
  • LinkedIn
  • Twitter
  • WhatsApp

Related Posts

Trending

  • H2O, Skiing, Hiding A$$ET$, Bitcoin, Ammo & More
  • There's Always a Way Forward for Americans Like YOU
  • America 2022: Time to Take Back What's Ours
  • What Living in Two Americas Looks Like Today
  • Why Buying Bonds Matters in Times Like These
  • Great Reset, Swiss Way, and Living YOUR WAY
  • How Are You Doing on a Local Level?
  • Stocks: Are You Sticking Your Neck Out Too Far?
  • Be Prepared for Another Great Lockdown, Recession, or Reset
  • February RAGE Gauge: Americans Focusing on What's In Front of Them

YOUR SURVIVAL GUY MUST READS

  • Why Vanguard is too Big: Part VII: What Do You Have to Lose? A LOT
  • Even Elon Musk, Tech Billionaire, is Looking for a Better America
  • Here’s What You Need to Get Prepared for Winter Storm Gail
  • The Man Behind Milton Friedman’s Classic Free to Choose TV Series
  • America Deserves Better Elections
  • When Dollars are Plentiful YOU Proceed with CAUTION
  • Why Americans Love Trump and Their Country
  • Your Retirement Life: “You Want Maine Lobster”
  • “They Stick a Q-Tip So Far Up Your Nose, You Can See it Through Your Eye”
  • The Great Reset: Bad Ideas Adopted Internationally by the World’s Most Powerful People
Only if You’re Serious
Only if You’re Serious
Only if You’re Serious
Escape the City
Smith Family Robinson
Only if You’re Serious
Why Vanguard is Too Big for YOU
See Who's Missing the Boat
You Invest, They Win
Emergency Water Storage
Emergency Water Storage
Emergency Water Storage
Why Fidelity is Number One

Copyright © 2021 | Terms & Conditions

loading Cancel
Post was not sent - check your email addresses!
Email check failed, please try again
Sorry, your blog cannot share posts by email.