Dividends in Focus: Apple Inc. (AAPL)

Consumer electronics juggernaut Apple Inc. (AAPL) fell off Wall Street’s “favorite” list near the end of 2012 and selling pressures plagued the stock for almost all of 2013. The stock did manage to find its footing mid-year, although its 2013 performance was still lackluster as it rallied a paltry 3%. Let’s examine the company’s current dividend policy and what lies in store for the stock in 2014 from a dividend perspective.

Apple Inc.’s Current Dividend Policy

Apple pays its dividend quarterly and currently offers a yield around 2.2%. The stock reinstated its dividend in the second-half of 2012 and its first payout was $2.65 per share. Apple raised its dividend in 2013 by 15%, marking the first annual increase for the stock, with its new distribution coming in at $3.05 per share. Based on analyst estimates, its payout ratio sits around 28% in 2013, and is expected to come in at 26% in 2014. Looking at these numbers coupled with Apple’s sizable cash flow, the company should have no issues raising its dividend again next year.

Dividend.com DARS Ratings for Apple Inc. Overall Rating:Neutral (3.4/5) Metric Rating Explanation

Relative Strength		Stock is performing in-line with the market or better.
Overall Yield Attractiveness		Stock’s dividend yield is above average.
Dividend Reliability		This rating is related to the length and consistency of a company’s dividend payouts, as well as our opinion on how likely the company is to continue payouts in the future.
Dividend Uptrend		Dividend payouts are consistent, but increases small.
Earnings Growth		Earnings estimates are uptrending.