Home / Top News / One of the biggest beneficiaries to GOP’s tax reform could be Apple

One of the biggest beneficiaries to GOP’s tax reform could be Apple


A member of staff photographs a customer as he checks the new iPhone X upon its U.K release in the Apple store, on November 3, 2017 in London, England.

Getty Images

A member of staff photographs a customer as he checks the new iPhone X upon its U.K release in the Apple store, on November 3, 2017 in London, England.

One of the biggest beneficiaries under the Republican tax reform plan will be Apple, according to one Wall Street analyst.

House Republicans revealed on Thursday its proposal to lower the corporate tax rate to 20 percent and for an one-time tax rate of 12 percent on cash holdings repatriated from overseas.

Apple said in a filing Friday it had $252.3 billion in cash held overseas.

Bernstein reiterated its outperform rating and raised its price target to $195 from $175 for Apple shares, citing the upside from lower corporate tax rates.

“Proposed US Tax Reform could be very accretive for Apple,” Bernstein analyst Toni Sacconaghi wrote in a note to clients Friday.

“The upshot is that proposed US Tax Reform could be very significant for the company. We believe Apple would likely repatriate all of its offshore cash.”

The analyst said the repatriation could allow Apple to buy approximately 15 percent of its outstanding shares or pursue a “more aggressive” acquisition strategy. He estimates the current GOP tax reform plan could boost the company’s earnings by 7 percent to 14 percent.

Apple CEO Tim Cook said on Wednesday the U.S. should reform the tax code now, telling NBC that companies don’t bring cash back to the U.S. because of taxes.

This “isn’t good for the U.S. There’s no tax receipts there,” Cook said. “And it’s not good for investment in the U.S. And so this needs to be fixed. In my view, it should have been fixed years ago. But let’s get it done now.”

Apple’s stock is up 45 percent year to date through Thursday compared with the S&P 500’s 15 percent gain.

Its shares hit an all-time high Friday morning after the company reported better-than-expected September quarter earnings results and gave a December quarter sales guidance range above Wall Street expectations at the midpoint Thursday evening.

About admin

Check Also

How yelling at kids affects their happiness, success

Almost every parent yells at their child eventually, no matter how hard they try to …