why is AAPL "dividend princes"

Apple (AAPL) is often referred to as a "dividend prince" due to several key characteristics that make it an attractive dividend-focused investment option:

1. Consistent Dividend Growth: Apple has a history of increasing its dividends over time. The company has raised its quarterly dividend for 13 consecutive years, which is a sign of stable and growing earnings that can support dividend payments.
2. High Dividend Yield: With a dividend yield of 0.52% as of April 16, 2025, Apple's dividend yield is competitive and attractive, especially in comparison to the relatively low inflation rate.

AAPL Payout Ratio, Dividend Yield (TTM)

3. Payout Ratio: The payout ratio is a metric that indicates how much of the company's earnings are distributed to shareholders as dividends. A lower payout ratio suggests that a company retains more earnings for reinvestment and growth, which can be positive for long-term prospects. Apple's payout ratio of -15.88% indicates that the company is retaining earnings for growth. However, a negative payout ratio suggests that the company is not generating enough earnings to cover its dividend payments, which could be a concern.

4. Dividend Stability: Apple has a track record of stable dividend payments, which is important for investors who rely on dividend income. The company's consistent dividend history reduces the risk of dividend cuts or non-payment.
5. Financial Health: Apple's strong financial health, reflected in its cash reserves and free cash flow, supports its ability to sustain and grow its dividend payments.
6. Dividend Policy: The company's dividend policy is aligned with a commitment to returning value to shareholders, which has been demonstrated through consistent dividend increases and share buybacks.

These factors combined make Apple a compelling dividend investment, earning it the nickname "dividend prince." However, it's important to note that the negative payout ratio indicates a need for the company to improve earnings growth to sustain its dividend payments.