Apple’s Takeover Targets: Tesla (NASDAQ:TSLA) and Netflix (NASDAQ:NFLX)

Apple’s Takeover Targets: Tesla (NASDAQ:TSLA) and Netflix (NASDAQ:NFLX)

Apple’s Takeover Targets: Tesla (NASDAQ:TSLA) and Netflix (NASDAQ:NFLX)


Friday, Citigroup listed 7 companies as potential takeover targets for Apple Inc.(NASDAQ:AAPL), including Netflix (NASDAQ:NFLX), Walt Disney (NYSE:DIA) and Tesla Inc.(NASDAQ:TSLA), as a way to put its cash hoard of more than $250-B cash pile to work.

With over 90% of its cash sitting overseas, a 1-time 10% repatriation tax would give Apple $220-B for acquisitions or buybacks, a Citigroup analyst said in a note to clients.

US President Donald Trump’s tax reform plan proposes allowing multinationals to bring in overseas profits at a tax rate of 10% Vs 35% now.

“Since one of the new administration’s top priorities is to allow U.S. companies to repatriate overseas cash at a lower tax rate, Apple may have a more acute need to put this cash to use,” he said.

The analyst is rated 3 out of 5 Stars for his recommendations on Apple, according to Thomson Reuters StarMine.

The other potential acquisition targets include video game developers Activision Blizzard, Electronic Arts and Take Two Interactive Software as well as video streaming service Hulu.

The analyst said the targets were screened considering 5 criteria, as follows:

  1. strategic fit
  2. global scale
  3. transaction size
  4. few non-strategic assets and
  5. likely impact on Apple’s share price.

Under pressure from shareholders to hand over more of its cash hoard, Apple recently boosted its capital return program by $50-B, increased its share buyback program by $35-B and raised its Quarterly dividend by 10.5%.

Symbol Last Trade Date Change Open High Low Volume
NASDAQ:AAPL 148.56 5 May 2017 2.03 146.76 148.91 146.76 21,561,700
HeffX-LTN Analysis for AAPL: Overall Short Intermediate Long
Bullish (0.30) Neutral (0.21) Bullish (0.27) Bullish (0.42)

Have a terrific weekend.

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Paul Ebeling

Paul A. Ebeling, polymath, excels in diverse fields of knowledge. Pattern Recognition Analyst in Equities, Commodities and Foreign Exchange and author of “The Red Roadmaster’s Technical Report” on the US Major Market Indices™, a highly regarded, weekly financial market letter, he is also a philosopher, issuing insights on a wide range of subjects to a following of over 250,000 cohorts. An international audience of opinion makers, business leaders, and global organizations recognizes Ebeling as an expert.

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