There remains a 40 percent chance that Apple will purchase Netflix. The video streaming giant is just one of Apple’s possible takeover targets as 2018 begins, according to Business Insider.
According to Citi analysts Jim Suva and Asiya Merchant, Netflix remains Apple’s No. 1 takeover target as the new year begins. This likelihood was also projected by the company in May 2017. However, it might be more realistic now thanks to recent corporate tax policy changes in the United States.
Last month, President Trump signed a new law that gives corporations a one-time allowance to repatriate cash stored overseas without taking a major tax hit. To date, Apple has over $250 billion in cash, most of it sitting abroad.
In the same Citi note, the analysts said there’s a 20 to 30 percent chance Apple would acquire Disney. However, the note was written before Disney’s proposed acquisition of Fox’s studio and TV assets.
Other possible takeover targets include Hulu, Tesla, Activision, Electronic Arts, and Take-Two.
In the note, Suva and Merchant explain why now might be the perfect time for Apple to spend some money:
The firm has too much cash – nearly $250 billion – growing at $50 billion a year. This is a good problem to have. Historically, Apple has avoided repatriating cash to the US to avoid high taxation. As such, tax reform may allow Apple to put this cash to use. With over 90% of its cash sitting overseas, a one-time 10% repatriation tax would give Apple $220 billion for M&A or buybacks.
With Netflix’s market cap at $86 billion and growing, it looks like the perfect time for Apple to make a bid, no?
Who do you think Apple should attempt to buy? Let us know below.
Who would you like to see Apple buy in 2018?— AppAdvice (@AppAdvice) January 2, 2018