The $50 Billion Company Gene Munster Wishes Apple Would Buy
It's earnings season and Apple is faring very well, the company smashed Wall Street's revenue expectations. Investment research firm Zacks held consensus expectations of $51.2 billion in revenue, but the tech giant reported $52.6 billion, 12 percent higher than a year ago.
According to Gene Munster, a long-time Apple watcher and managing partner at Loup Ventures, this is the company's best quarter in years.
"December of 2014 was the last time that Apple grew every product in every geography," Munster told Cheddar on Friday.
And since that time, the company has amassed a pretty big cash stockpile. For the quarter, Apple CFO Luca Maestri said the company “generated strong operating cash flow of $15.7 billion and returned $11 billion to investors through [its] capital return program.”
At the end of the quarter, the tech giant had nearly $270 billion on its balance sheet. That's bigger than the entire market cap of Wal-Mart...and the GDP of Venezuela!
And Munster has some ideas for what the company can do with that money. If Apple wanted to make an acquisition, for example, he thinks the best move would be American automaker Tesla.
"Netflix is always out there," as a possible target, he said. "It would make a lot of sense because it would play into its service business. [But] the company that I wish it would buy is Tesla." He cautioned though, that he doesn't think it'll happen.
"Elon Musk doesn't want to sell, but as a backstop, as you see the Tesla shares slide here, I think Apple would love to buy them at some point."
Unlike Apple, Tesla posted a big miss in its latest quarter, recording its largest ever loss of $2.92 a share.
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