“This afternoon came news via a simple 140 space statement that Carl Icahn currently had ‘a large position’ in Apple (AAPL),” George Acs writes for Seeking Alpha. “By all accounts his discussion with CEO Tim Cook were cordial. Icahn himself, in another 140 space blast referred to it as ‘nice,’ and he anticipated speaking to Cook again shortly.”
“Despite his recent foray into Dell Computer, his history as an activist shareholder has not included many companies in the technology arena,” Acs writes. “Icahn refers to Apple as being ‘undervalued’ but he isn’t looking at a low P/E to buttress his opinion. He is looking at a continuing large cash position that he envisions as a means of expanding the already large share buyback, that to many has already been the source of Apple strength going from its near term lows to $450.”
“This is not a case of finding fault with leadership, this is not a case of someone seeking to prevent shareholders from being robbed blind in an insider buyout deal. Apple is very different from Dell in so many ways,” Acs writes. “This is all about leveraging cash, without regard to product pipeline and without regard to product margins. This isn’t about cutting expenses or changing direction. It is as pure as you can get – it is about cash.”
Acs writes, “Icahn cares nothing about this company other than for the cash it holds… While not terribly different from David Einhorn’s earlier attempt to wiggle cash out of the Apple coffers, Icahn is relentless and scrappy. What starts as perhaps a nice discussion can quickly go elsewhere. While there is a quick pop in Apple shares in the aftermath of the announcement and while I anticipate shares to move even higher, this is the end for the Apple that you knew and loved. It wasn’t the death of Steve Jobs, but rather the indirect impact of his absence that spells the end, as Apple becomes like so many other companies simply nothing more than a vessel for someone that will have as limited interest as a pedestrian day trader.”
Read more in the full article here.
MacDailyNews Take: Overwrought hyperbole bordering on hysterics, but Icahn definitely must be treated with the respect afforded a king cobra.
Good luck, snake-handler Tim!