Updated to include details on new Apple investment.
Share repurchases and dividend payouts are not helping revive Apple's (AAPL) lagging stock price. So is it time for the tech giant to tap its sizable cash pile and buy a game-changing business to excite investors?
One possibility bandied about -- electric car maker Tesla (TSLA) , which is a place that often serves as a talent pool for Apple.
Apple "could certainly [buy Tesla] if they wanted to. They certainly have the financial capacity to do so," said former Apple CEO John Sculley in an interview with TheStreet. "If they chose to [buy a big company] I am sure they would only do it with a product that was intended to be revolutionary in a large addressable market. So an automobile maker like Tesla would certainly meet that criteria."
However, Sculley noted the company "has no history of buying a really big company, so they would have to think about that a lot as to how they would incorporate it and manage it." The last sizable business of any kind that Apple bought was headphone and music subscription purveyor Beats for $2.6 billion back in 2014.
Since then, Apple has continued down a path of acquiring small upstarts with promising future technology, while watching its cash hoard balloon. The company now has over $250 billion in total cash, which represents about half of its market cap.
Apple purchasing Tesla to gain access to the company's advanced battery technology and electric car capabilities is not such a far-fetched idea. "In our view, acquiring Tesla's advanced battery technology would greatly accelerate Apple's entrance into the next-generation auto arena, and we estimate valuable economies of scope could be realized while transitioning to mass-market volumes (e.g., consumer electronic batteries, automotive software, etc.)," wrote FBR & Co. analyst Dan Ives in a note earlier in the year.