THERE ARE many ways to break down Apple's amazing earnings report from this past week, but let's start with the cash.

The maker of iPods, iPads and iPhones reported that it earned $13 billion in its past quarter, or roughly $1 billion a week. Apple now has $98 billion in cash sitting in the bank. That alone is more than the market value of all but about 50 companies in the world.

To put it into further perspective, Apple's cash stake is worth more than UPS, Walt Disney, Home Depot or Bank of America. It is about equal to California's 2012-2013 state budget.

And the pile continues to grow. The company generated about $17 billion in free cash flow last quarter, and that figure is expected to grow. That means by this time next year Apple's cash mountain could be nearing $200 billion, an astounding figure.

That creates something of a problem for Apple CEO Tim Cook, though it's one just about all executives would love to have. The company is making almost nothing on that cash, and there are increasing calls from investors to return some of it in dividends. Apple's late co-founder and visionary, Steve Jobs, was against a dividend, but Cook is reportedly more receptive to the possibility.

About $64 billion of Apple's cash is overseas, and it would have to pay Uncle Sam a hefty amount in taxes to bring it back into the U.S. But with the $34 billion balance already here and additional cash pouring in every week, Apple could easily afford a dividend ranging from modest to exceedingly generous and still have plenty of dough left over.

Many analysts think that a dividend would boost Apple's stock price, as it would attract investors who focus on yield and value. At first glance, Apple's stock price--which hovered around $450 late this week--appears rich. But that's mostly because the stock never splits, much like Warren Buffett's Berkshire Hathaway, whose "A" shares trade for around $120,000 a pop.

Though Apple is now neck and neck with Exxon Mobil Corp. for the title of world's most valuable company, a case could be made that the company is greatly undervalued. Its price-to-earnings ratio is only about 10. Strip out the cash and the PE is eight times earnings.

Those are multiples usually reserved for companies with far less growth potential. Apple's iPhone and iPad sales both more than doubled in the last three months of 2011. Many say the company has only scratched the surface in those large markets, both in the U.S. and overseas. Apple likely has new products in the pipeline, and its iCloud ties customers to their various iDevices.

And that's why a Thursday Wall Street Journal column that wrapped up with the following sentence appears to be on mark: "Apple shares still look like a bargain."

Staff reporter Bill Freehling writes this biweekly column on business, personal finance and investing. He can be reached at 540/374-5405 or
Email: bfreehling@freelancestar.com.