"The firm has too much cash – nearly $250 billion – growing at $50 billion a year. This is a good problem to have," Suva and Merchant told clients. "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."
It's estimated that Apple would only need a third of that to buy Netflix. The acquisition would also align with its recent content creation efforts.
According to Citi, Apple's second most likely acquisition target is Disney at around 25% probability; however, the investor note was written before Disney announced its Fox acquisition. Tesla is listed at around 5% likelihood.
Check out the chart below and let us know which of these companies you'd want Apple to acquire.