Dividend Drives Apple to $600 — Monday’s IP Market Recap

by Kyle Woodley | March 19, 2012 4:41 pm

InvestorPlace Market Recap[1]If you saw a rainbow today, chances were it led to Cupertino, Calif., and the pot of gold Apple (NASDAQ:AAPL[2]) plans to dump on shareholders July 1 in the form of its first dividend since 1995.[3]

The company announced it would use some of its $100 billion in cash to fund a $2.65 quarterly dividend, good for a yield of about 1.8%, and Apple also will buy back $10 billion in stock.

The news was enough to drive Apple shares up 2.7%, closing above the $600 mark for the first time. At $601, AAPL stock has gained almost 50% since the start of the year and 80% in the past 52 weeks.

Meanwhile, Bank of America (NYSE:BAC[4]) also hit a more modest milestone — $10 per share — but then immediately backtracked and actually ended up down more than 2% by the end of Monday’s trading. Bank of America had been riding the momentum of last week’s “stress test” results release[5]. BofA passed, and although it did not announce a dividend hike — a la JPMorgan Chase (NYSE:JPM[6]) and Wells Fargo (NYSE:WFC[7]) — investors still bumped up shares by about 15% since then.

No. 3 U.S. telecom Sprint (NYSE:S[8]) also had a long day, losing 4.5% on continued rumors that the company could eventually file for bankruptcy following a serious blow to its ability to provide 4G wireless service. Sprint recently ended its deal with Lightsquared, which would have allowed the company to provide 4G-LTE service. As it stands now, Sprint now will have to build out such a network itself — an undertaking that requires both time and money, which Sprint is short on.

Three Up

Three Down

Kyle Woodley[15] is the assistant editor of InvestorPlace.com[16]. As of this writing, he did not hold a position in any of the aforementioned securities. Check out recaps from previous trading days here[17].

  1. [Image]: http://investorplace.com/hot-topics/investorplace-market-recap/
  2. AAPL: http://studio-5.financialcontent.com/investplace/quote?Symbol=AAPL
  3. in the form of its first dividend since 1995.: http://investorplace.com/2012/03/does-apple-dividend-signal-end-of-growth-aapl/
  4. BAC: http://studio-5.financialcontent.com/investplace/quote?Symbol=BAC
  5. last week’s “stress test” results release: http://investorplace.com/2012/03/federal-reserve-stress-tests-jpm-dividend-citi/
  6. JPM: http://studio-5.financialcontent.com/investplace/quote?Symbol=JPM
  7. WFC: http://studio-5.financialcontent.com/investplace/quote?Symbol=WFC
  8. S: http://studio-5.financialcontent.com/investplace/quote?Symbol=S
  9. FRO: http://studio-5.financialcontent.com/investplace/quote?Symbol=FRO
  10. LGF: http://studio-5.financialcontent.com/investplace/quote?Symbol=LGF
  11. X: http://studio-5.financialcontent.com/investplace/quote?Symbol=X
  12. KBH: http://studio-5.financialcontent.com/investplace/quote?Symbol=KBH
  13. YGE: http://studio-5.financialcontent.com/investplace/quote?Symbol=YGE
  14. YOKU: http://studio-5.financialcontent.com/investplace/quote?Symbol=YOKU
  15. Kyle Woodley: http://investorplace.com/author/kyle-woodley/
  16. InvestorPlace.com: http://investorplace.com/
  17. here: http://investorplace.com/hot-topics/investorplace-market-recap/

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