Apple Announces New Set of Corporate Bonds
Corporations announced a wave of fundraising today through the corporate bond market, but the most notable one is Apple, which will raise $ 7 billion in its first bond sale of 2017.
the company first touched the bond market in 2013 and periodically raised more, though it has $ 300 billion in cash. The latest issue is a 5-part, including $ 1.5 billion in 30-year bonds that will fetch about 3%.
Money can be used to buy back shares (there are about $ 100B allowed for redemption), acquisitions or debt repayment.
In the bigger picture, Apple has an excellent track record of selling bonds at times when yields have fallen close to cycle levels. Could this be a sign that the decline in yields has gone too far?
Their sales of bonds denominated in a foreign country are mixed. In September
In 2016, they sold euro denominated bonds with EUR / USD at 1.1270. The currency rose to 1.25 two years later before falling back to these levels in the last few months. Yields in Europe continue to fall.
In November 2014
Apple sold yankee bonds for the first time at EUR / USD 1.25 in what it was
timely sale on the foreign exchange market, but the profitability of the German package continued
fall to almost 0%.
In May 2015, Apple yen-denominated hard bonds were near the peak of the USD / JPY cycle at 125.00.