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It shouldn't come as a surprise that
AAPL) is on our list. The firm has a reputation for holding more cash than any other - even more at one point in 2011 than the U.S. Treasury in fact. At last count, Apple's cash stood at more than $144.5 billion, with minor offsetting debt. Only around $12 billion of that is actually true net cash the rest is long-term liquid investments managed by Apple's in-house investment firm, Braeburn Capital.
Yes, when you have that much cash on hand, you need your own treasury management firm.
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It's been a big week for Apple. Yesterday, at the firm's Worldwide Developers Conference, Apple unveiled a slew of software and hardware updates, including major iterations for its Mac OS X computer operating system and the iOS software that fuels Apple's mobile products. Subjectively, the upgrades look impressive -- almost as impressive as the stats that CEO Tim Cook mentioned during the keynote. A refreshed Mac Pro workstation is a particularly important direction for the company, as it renews its longstanding relationship with power-users. Professional-grade products may contribute a small amount to Apple's revenues, but they contribute a lot to its product innovation.
While shares dipped after the keynote, that's nothing new -- it's happened for the last four straight years. I've made no secret of the fact that I'm a fan of Apple as a company, just not as a stock (yet). But with the downtrend in shares broken in the last month, buyers may have an opportunity to jump in in the very near-term. From a technical standpoint, I'd be a buyer on a move above $460. From a quantitative standpoint, this stock's cash position is signaling a buy.
Data management firm
NTAP) is riding the rising wave of cloud computing. Data storage is the firm's bread and butter, and as storage and back-up needs increase around the world at a breakneck pace, NTAP is well-positioned to benefit. Better still, shares are cheap from a valuation standpoint: the firm's $4.7 billion net cash position pays for more than 34% of its market capitalization right now.
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NetApp is one of the few pure-play storage firms that have been around for a while. As a result, the firm has the advantage of a large customer Rolodex and an established niche in the data game. Because NetApp's network-attached storage devices can be purchased ad-hoc (rather than as part as a major datacenter overhaul), it's an ideal vendor for firms whose storage needs are gradually increasing (and those who don't want to shell out massive capital for all-new IT infrastructure).
NTAP's stellar balance sheet position gives it plenty of options right now, especially as most smaller computer storage names are in a counter-cyclical period; it means that M&A opportunities remain relatively cheap, and the firm can still add value through acquisitions. As NetApp continues to build out its OEM partnerships and increase sales to its established customer base, investors should continue to draw returns from its stock.