“Apple’s move to buy $14 billion worth of its own stock not only got activist investor Carl Icahn off the company’s back, the measure also signaled confidence in a big new product, CNBC’s Jim Cramer said Tuesday,” Jeff Morganteen reports for CNBC.
“‘This is going to be [Apple CEO] Tim Cook’s chance to show, ‘Look people, you wrote us off as a growth stock. We have growth again,” Cramer said on ‘Squawk Box.’ ‘It’s one of my favorite stocks in the market,'” Morganteen reports. “Cramer said on Tuesday that a company wouldn’t invest $14 billion into itself if it didn’t have a big product lined up.”
Morganteen reports, “‘Isn’t it interesting that Icahn goes away and what does the stock do?’ Cramer said. ‘It led technology yesterday. What does that tell you? That this is a company that was opportunistic and aggressive in buying its stock when it got hit. And you wouldn’t do that. You wouldn’t spend $14 billion unless you’ve got something in the pipe that could dazzle.'”
Read more in the full article here.
MacDailyNews Take: Or, Apple simply figured, ‘Hey, we’ve already got a share repurchase program running at an average rate of $30 billion per year, so we might as well spend half that right now when it’s irrationally down 10% after all-time record earnings.'”
It ain’t rocket science.
Apple buys back $14 billion shares in two weeks – February 6, 2014