CF Apple Computer

Mr. Jobs, buy back this stock. A day ahead of the company’s Tuesday shareholder meeting at Apple headquarters in Cupertino, Jobs and company have the unique opportunity to ignite once again the excitement among the Mac faithful. And faith is really what this is all about. Faith in its products; faith in its past; faith in its future. Mr. Jobs! Buy back this stock. I have math and Apple’s future on my side here.

Apple’s got about 906 million shares outstanding and a staggering $18.5 billion in cash on the balance sheet. Generating about $1 billion in cash a quarter. And no debt. With a stock trading at about $125 a share, Apple could afford to reduce its outstanding shares by as much as 10 percent and still have an enormous cash position left over. Further, if it stretches the buyback over the next year or so, it would be replenishing chunks of the cash it’s spending on stock every quarter.

Not only would the announcement become a clarion call to investors that Apple was “investing” in its future, it would shrink the float and increase earnings per share. Which would drive the stock higher, and increase its market cap. A win, win, win. Apple has been reluctant to part with cash under any circumstances. Its standard line has been it needs a healthy balance sheet for strategic acquisitions and other investments in its future. Come now, really.

I’m not talking about eliminating ALL its cash. Just $10 billion or so. Leaving plenty left over for strategic acquisitions. But seriously, when was the last time Apple embarked on any meaningful acquisition? Hmmm? It’s not as if Apple is Microsoft, which has been a regular acquirer for years. Sure, Microsoft has an enormous cash position; spends it; replenishes it; spends some more; and buys stock back along the way. All things to all investors.