Apple Inc. (NASDAQ:AAPL) has made a habit out of posting stunning profits, then hoarding that cash quarter after quarter. Apple earnings this week stuck to the playbook, with profit more than tripling to $7.31 billion and helping push the tech giant’s war chest up to a stunning $76.2 billion in cash and equivalents.

But what good are those profits if Apple doesn’t put them to use? Many investors have been wondering for a while just what Steve Jobs & Co. plan to do with all that cash – and this week, a rumor emerged that might provide the answer: Apple might buy online TV programming powerhouse Hulu.

Bloomberg ran a report on the rumors today, based on two inside sources, but it’s actually been an idea that Wall Street has kicked around for some time. Both Hulu and streaming video giant Netflix (NASDAQ:NFLX) have been on the list of Apple acquisition targets for a host of reasons.

The obvious way Hulu or Netflix could benefit AAPL is through Apple’s digital TV and movie rental business, which either company could easily supplement. Industry insiders estimate Apple’s share of the pie is one-tenth the share of Netflix – and the quickest way to achieve dominance is to acquire one of the other players in the digital programming arena.

What’s more, such a move wouldn’t just create revenue via digital rentals. One of Apple’s newest gadgets is the set-top Apple TV device that is meant to interface with the aforementioned Apple programming service. Apple TV retails for $99 and has sold 1 million units so far – a not-insubstantial number. But anyone familiar with streaming video and digital distribution knows how difficult it is to forge partnerships with quality content providers, and Apple’s growth has come with reasonably limited programming.

Access to Hulu or Netflix catalogs could make Apple TV tremendously more attractive by offering access to a wider array of shows and movies. A robust catalog managed by Apple and streamed to Apple TV could push the device to the mainstream – and provide it yet another dominant gadget in the consumer electronics space.

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So why Hulu instead of Netflix? Well, even though Apple’s $76.2 billion in cash might sound like a ludicrous sum, the company clearly wouldn’t want to spend every cent. And Hulu is a smaller fish on the streaming video scene compared with Netflix, which is valued at almost $15 billion right now. Typically, companies demand a significant premium from their suitors to price in future growth potential, so a NFLX deal would be an aggressive move. By contrast, analysts say that Hulu likely would be worth “only” $2 billion.

Of course, these are just rumors. Hulu is co-owned Walt Disney Co. (DIS), News Corp. (NWSA) and Comcast Corp. (CMCSA) – the respective corporate parents of ABC, Fox and NBC. Getting everyone on board could be a daunting task.

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What’s more, if the rumors are true, you can bet Netflix will be a bit nervous about the prospects of a deal. Netflix already is seeing strong competition from Hulu, and murmurs of Apple-Hulu alliance might prompt it to deal with AAPL to ensure it winds up on the winning side of the streaming wars.

And let’s not forget that while Hulu certainly is within the buying power of Apple, the company never has made a truly dramatic acquisition despite all the speculation on Wall Street. Its biggest deal was a $400 million buyout way back in 1996 as part of a move to bring Steve Jobs back to the helm.

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The company has been sitting on a cash horde for years and hasn’t made a big deal, so why start now?

Of course, the answer to that question might be that Hulu is the perfect company at the perfect time at the perfect price. But we’ll just have to wait and see if this is just another Apple rumor or actually a report that has legs.

Jeff Reeves is editor of InvestorPlace.com. As of this writing, he did not own a position in any of the stocks named here. Follow him on Twitter via @JeffReevesIP and become a fan of InvestorPlace on Facebook.