“Billionaire investor Carl Icahn said he increased his stake in Apple Inc. (AAPL) by another $500 million, bringing his total holdings in the iPhone maker to about $3.6 billion as he reiterated calls for a bigger stock buyback,” Beth Jinks reports for Bloomberg. “”
“Icahn released a seven-page open letter to shareholders of Cupertino, California-based Apple yesterday, repeating his recommendation that the company increase its share-repurchase program,” Jinks reports. “Icahn announced the additional shares in a new posting on Twitter Inc., following a series of tweets Jan. 22 stating he purchased $500 million of shares in the past two weeks.”
“Icahn, 77, first disclosed his Apple stake in a tweet on Aug. 13, when the stock was trading at about $468. The shares have since gained 19 percent. Icahn, who became a billionaire by buying stakes in companies and then publicly pushing management and directors for changes to boost the stock, has been pressuring Apple since to return more cash to shareholders,” Jinks reports. “Prior to Icahn’s involvement, Apple Chief Executive Officer Tim Cook announced a plan for a total of $100 billion in dividends and buybacks.”
Read more in the full article here.
MacDailyNews Take: Here’s the thing, most agree that Apple’s stock price is undervalued; significantly so, many believe. Based on P/E ratio (especially compared with other tech companies), Apple shareholders simply have not been getting a fair appraisal by the market for quite some time now. Every share Apple takes off the open market theoretically increases the value of the remaining shares, but if Apple has to sacrifice anything regarding their real plans for the money, assuming they have plans for the money, then they should go tell johnny-come-lately Icahn to go pound sand.
I see many fist prints on the beach…
this is gettin’ lamer than another Obama promise.
http://online.wsj.com/news/articles/SB10001424052702303448204579336941892062778?mg=reno64-wsj&url=http%3A%2F%2Fonline.wsj.com%2Farticle%2FSB10001424052702303448204579336941892062778.html
Shield yourselves from the false messiah, Obama!
All hail the True Messiah, botvijerk!
He bringeth all truth and wisdom.
botvijerk messiah for President!
oh come on, enough of the moderation crap, MDN.
If it were anyone but you, Bot, I’d agree.
But you need more than a little moderation, you know?
Screw him, greedy meddling bastard. Cook could care a rats ass. Even with his amount of owned stock, it’s still just .5 percent of all Apple stock. Now he’s trying to tell Cook to reorganize their BOD. Keep trying Carl, Tim Cook doesn’t like you.
This guy is a legend in his own mind. I just think he’s a greedy asshole.
Apple is the most successful company of all time, stealing from none, delivering value to all. As a result of this good management and brilliant products, they are making more money than they can spend, right now.
Since the customers put more money in than new boy Icahn, let’s spend the excess money on them, in the absence of a larger plan. How about an immediate and retroactive 10% price cut on all Apple hardware products? Or a consumer lottery, where, each January, Apple picks one month of the past year and all hardware purchase prices are retroactively refunded?
That would do a lot more for Apple than responding to Icahn’s whining about making his $3B worth a little more.
Icahn can only see things from a short-term point of view and even within that short term view, he only looks for potential profits from speculating on AAPL. His approach couldn’t be more different from Cook’s, who knows what it takes to add meaningful value to a company and steer it through difficult waters.
Cook is in no doubt about what Icahn is like and what he’s after. Cook also knows that trying to appease Icahn would be a huge mistake.
Carl is about 100 times smarter than Tim Cook. If the Apple lemmings would do just a little more than blindly condemn anyone who questions what Tim and his useless BOD are doing, we might get AAPL unstuck from the doldrums. Get over yourselves. You are standing in the way of getting the company and its products back to where they were when Apple and its products were really superior instead of pretty much like all the others only late to arrive on the shelf.
It has nothing to do with being a lemming or believing Tim Cook. It has to do with old school business sense. You don’t borrow money when you don’t have to just to feed outside organizations that have no interest in making the company better but rather just have an interest in making short term profits and running.
How does borrowing money and buying back AAPL stock help Apple. (Note, I used a period rather than a question mark because it’s a rhetorical question and because I don’t expect you to come up with a relevant answer.) You do realize that AAPL stock and Apple Inc. are two distinctly different things, don’t you? Or, are you one of those people who believe the money held by Apple actually belongs to AAPL holders as in “return value to shareholders”?
And, can you explain how doing a stock buyback has *anything* to do with “getting the company and its products back to where they were”? A stock buyback only assures a short term increase in the stock price. Because Wall Street does NOT tie stock prices to hard metrics (like dividing the Book Value of a company by the number of issued shares, or the most recent year’s post tax profits divided by the number of issued shares) there is *ABSOLUTELY* no assurance that the stock price will stay at the increased level.
A stock buyback has *ABSOLUTELY ZERO* to do with how Apple spends its IR&D budget or how Apple spends its acquisition budget or how Apple does strategic investments, e.g., sapphire manufacturing or liquid metal license. In fact, if Apple spends a significant fraction of its U.S. cash on the buyback, Apple will have less money to spend on either IR&D or acquisitions or strategic investments. How can having less money for those help in any way?
What is virtually 100% certain is that if a large stock buyback is announced by Apple the stock price will jump in the short term and bottom feeders like Icahn will dump their stock to take their profits and run. Icahn can say as many times as he wants that he is into Apple for the long haul, but unless he signs some legally binding agreement to not sell AAPL if the stock jumps up, based upon his track record over the past 30+ years, he’ll take his profits and run. He’s known as a corporate raider for very good reason.
I’d have agreed if you said about 12.3 times smarter. But, 100? That’s just crazy talk.
You’re argument would carry a lot more weight without the childish name calling. Just saying…
Uh, that was supposed to be: “Your argument” not “You’re…”
Agree with MDN’s take.
Just because no one has thought if a potential use for $150 billion doesn’t mean there isn’t one.
Consider: banking, infrastructure projects (network-related, vehicle-related, etc.)
PESTERING PARASITE