Apple CFO Drops Small Clues About Company's Big Plans
Apple Chief Financial Officer Peter Oppenheimer recently connected with Katy Huberty, the prominent Wall Street analyst and resident Apple watcher at Morgan Stanley.
On Friday, Huberty revealed that Mr. Oppenheimer provided some key insights into moves Apple might make in the coming months. Without supplying too many details, Huberty says that Oppenheimer's comments (which weren't revealed) suggest some strong possibilities about what Apple will do this year.
For starters, Huberty says she walked away from the meeting with the distinct impression that Apple will likely increase the 2.3% dividend to AAPL shareholders.
"Our analysis," she told investors this morning, "suggests Apple can match the S&P IT sector's average FCF [free cash flow] payout of 68% if it returns $28B in FY13, implying a 6% total yield. High mix of international cash limited flexibility in the past but raising low-interest debt can help address this issue, in our view."
Huberty contends that Apple hasn't taken the concept of an "iPhone mini" off the table as the smaller, more affordable entry-level iOS-powered smartphone could be a big revenue driver in emerging markets.
"The company's approach to product decisions and innovation has not changed in the past several years despite the CEO transition," Huberty concluded. "Making great products remains Apple's core strategy and the company is as confident as ever about the future pipeline of new products and services."
Morgan Stanley retains a price target for AAPL at $630.