Tags: Apple | spend | cash | Bilton

NYT's Bilton: Maybe Apple Can Spend Its Cash Trove on Buying Mars

Wednesday, 09 Apr 2014 07:09 AM

By Dan Weil

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Apple has the largest cash reserve of any company outside the financial industry — $159 billion, according to Moody's Investors Service.

But the company has indicated a reluctance to spend that money on acquisitions like the kind that have recently made headlines for Facebook and Google.

Apple may be hoarding some of its cash in case it faces financial troubles in the future, Rick Lane, a Moody's analyst, told The New York Times. Apple once fell on "very difficult times, and had to rely on, in part, the kindness of others," he noted.

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"Without having to rely on the capital markets, which can be mercurial, it's a kind of self-insurance to have that cash on hand for the times when things go bump in the night," he said.

The Times' Nick Bilton offered several suggestions for what Apple can do with its cash.
  • It could buy Mars. "NASA scientists recently said a human mission to Mars with the goal of building a colony would cost about $160 billion. NASA even floated the idea that big corporations could sponsor the trip," Bilton wrote.
  • Apple could buy Tesla, the electric car maker, which is valued at about $30 billion.
  • As telecommunications companies are so important to Apple, it could buy T-Mobile, which is valued at about $26 billion, Bilton said.

Morningstar analyst Brian Colello offered praise for Apple, but with caveats.

"Although Apple has a sterling brand, robust product pipeline and ample opportunity to gain share in its various end markets, short product life cycles and intense competition will prevent the firm from resting on its laurels or carving out a wide economic moat," he wrote on Morningstar.com.

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