Now that Apple has shown how it plans to spend some of its staggering $100 billion cash hoard—by paying a dividend and buying back its own shares—plenty of people have ideas about what else it could do with that growing mountain of money. Barry Ritholtz, a widely followed financial analyst and blogger, argues that Apple should buy Twitter, primarily because doing so would add the crucial social component that Apple still lacks, despite its growing dominance in personal electronics and entertainment. Is he right?
Although Twitter’s market value is estimated to be about $9 billion or so—based on the company’s last financing round—there’s no question Apple could buy the company quite easily (along with a huge number of other things, including Research In Motion and Facebook). According to some estimates, Apple’s massive cash pile will continue to grow, despite the fact that it is now going to be paying out $15 billion in dividends every year. There’s a good chance that Twitter would accept Apple stock as part of the package if it wanted to sell.