Will Apple Force U.S. to Address Cash Repatriation?

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April 24 (Bloomberg) -- Robert Nardelli, CEO/founder at XLR-8, examines how Apple’s share buyback plays into U.S. tax structure and whether the buyback will satisfy investors on Bloomberg Television’s “Bloomberg Surveillance.”

Got too cheap.

It was trading at the same level as pharma.

A busy morning.

Our guest this morning as the former ceo of chrysler and home depot.

I want to get your take.

Overall, what to make of this?

Is this a sign of a healthy market?

We are seeing a tremendous amount of activity.

People are looking for opportunities to jump in.

Companies where they see topline growth.

We just heard about apple.

He did a good job of growing his core.

The question now is, what happens in the back half of the year?

To me, yesterday was a history of it.

Many others wanted a day.

At the end of the day, this is about finance.

For any company, returning cash to shareholders.

I think the thing that was intriguing to me is that they're going to go out and leverage, as opposed to repatriate.

Use cash, issued debt.

The important thing here is, as china begins to grow, we have to address that as a country.

The administration has to face any issue of how do we encourage repatriation for redistribution?

There are many other companies we never talk about.

There is a plethora of companies that have cash.

A couple trillion dollars when you roll it all up.

How do we address that?

You famously lifted margins at home depot from 30% to 34%. how hard is it to do that?

It depends on the starting point.

If you have not had the intensity and focus on cost of goods sold, manufacturing efficiency, then you get a good lift early on.

That is what we get at home depot.

The interesting thing with apple is this dichotomy of dividend increase, buying shares back, and doing a 7-1 split.

I think we will see a short-term satisfaction by the investors.

The thing i faced was the longer-term.

Why are you spending more on reinvestment?

Why aren't you growing globality as opposed to giving us cash?

There is a push poll in the short term activists and the long-term people who want to continue growth.

A lot of people say this will embolden the investors to push for more capital return.

Is that a new hostile takeover?

Recent surveys were performed by ernst & young -- one of the biggest issues is activists.

How do you engage them as opposed to having an adversarial relationship?

As surveillance exclusive -- the printer is fixed.

Continuous surveillance.

The show will go on.

Bob nardelli is with us for the hour.

He is the ceo of chrysler and home depot.

More on activists investing.


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