Updated from 12:18 p.m. EST to provide comments from J.P. Morgan in the ninth and tenth paragraphs.NEW YORK ( TheStreet) - Apple's ( AAPL) decision to announce a share buyback and dividend on Monday will push shares to new heights, say analysts. Although a dividend was largely expected, the Cupertino, Calif.-based company also announced a $10 billion share-repurchase program before market open. Apple said it expects to spend $45 billion over the next three years in dividends and buybacks.
Jefferies analyst Peter Misek wrote that he did not expect the buyback, but sees the new cash strategy as very positive for the stock. "The large market cap is one of the major hindrances to further upside, and this announcement will allow dividend investors to get involved," he explained. Misek also noted that he expects dividend increases in the future, as Apple periodically revisits its dividend policy. The analyst rates Apple shares "buy" with a $699 price target. J.P. Morgan analyst Mark Moskowitz wrote that he expects Apple shares to climb higher in the coming days based on the announcements. He notes that Apple paying a dividend is not a sign the high-growth days are over, but rather a product of the "major cash flow generation power that is attached to Apple's high-growth operating model." He went on to write, "Apple's ability to monetize its innovation and strategically invest in the supply chain has underpinned above peer revenue, earnings and cash flow growth, which has lifted the stock in recent years. We think the dividend and buyback likely give another boost to the stock." Moskowitz rates Apple "overweight" with a $625 price target. On the conference call, Apple CFO Peter Oppenheimer said, "We want to achieve several objectives - we want to extend the attractiveness of Apple to a wider investor base." Oppenheimer also said that none of Cook's unvested RSUs (restricted stock units) would participate in a dividend. Cook was granted 1 million RSU's in early 2012. Apple will initiate a quarterly dividend of $2.65 per share in the fourth quarter of 2012. Apple last paid a dividend to shareholders in 1995, prior to Steve Jobs' return to the company in 1997. Apple did not discuss any product initiatives during the call, but Cook noted that the new iPad had a "record" launch over the weekend. The new iPad features chips from companies such as Qualcomm ( QCOM), Broadcom ( BRCM), Skyworks Solutions ( SWKS) and Texas Instruments ( TXN). Shares of Apple are higher in Monday trading, up 2.25% to $598.82. Also: 8 Stocks Rising Fast on Rich People's Spending 10 Stocks Owned by the Best Fund Managers The 10 Worst of the Worst in 2012 -- Written by Chris Ciaccia in New York >To follow the writer on Twitter, go to http://twitter.com/commodity_bull.