The Apple box is succulent

The rise in interest rates has contributed to bank failures, housing market problems and a general feeling of malaise on the stock market.

For Apple, on the other hand, the sharp change in monetary conditions has golden and succulent connotations.

The manufacturer of the iPhone announced this week that it closed the first quarter with liquidity and assets ready to sell that exceeded its indebtedness by 57,000 million dollars.

This represents an opportunity for his boss, Tim Cook.

The financial director, Luca Maestri, promised in 2018 that the liquidity of the company would end up matching his indebtedness.

Despite generous deals for investors, including an announced dividend hike and a promise to buy back another $90 billion of shares, Maestri has so far fallen short of that goal.

And the cash keeps coming in.

Analysts expect Apple's operations to produce around $100 billion in free cash flow after investment spending over the next four quarters.

That would almost be enough to cover the buyback program of 90,000 million dollars without having to touch the balance sheet.

Furthermore, the company continually sells

and services at a rate greater than its payments to suppliers, which only adds to the liquidity cushion.

The rise in rates has punished companies that hold long-term investments with fixed-rate payments, from long-term Treasuries to asset-backed securities.

Apple, by contrast, has had the vision to cut its long-term investments by nearly in half over the past five years, and has used that money largely to buy back shares.

Although Cook could limit himself to investing that liquidity in short-term Treasury bills, there is a better option, which is to offer financial services to his clients.

The company is timidly entering territory that was previously the domain of banks, for example, by partnering with Goldman Sachs to launch a credit card and a new high-yield savings account, and by launching Apple Pay Later ( Apple pays later).

FOR MORE INFORMATION: BREAKINGVIEWS.REUTERS.COM.

The authors are columnists for Reuters Breakingviews.

Opinions are yours.

The translation is the responsibility of EL PAÍS

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