Why Carl Icahn will eventually get what he wants from Apple

“It’s another day, and another media frenzy surrounds Carl Icahn, chairman of Icahn Enterprises. This time, Icahn took to social media to declare that he had dropped his bid for Apple to substantially increase its share buybacks,” Bob Ciura writes for The Motley Fool. “Icahn had long pushed for Apple to buy back as much as $50 billion of its own shares, putting to use some of the more than $150 billion in cash and investments Apple has on its books.”

“While Icahn backing off may seem like a victory for Apple, it doesn’t seem likely that he would simply give up. After all, he’s got a tremendous track record of latching onto companies and standing his ground until he gets what he wants,” Ciura writes. “Apple’s accelerated buyback means Icahn is already on the way to getting his wish. Plus, the prospect of new products from Apple this year means fresh revenue streams and an even greater opportunity for Apple to increase its buybacks later this year, if it chooses to do so.”

“All along, Icahn’s true motive was to produce a higher earnings multiple for Apple. For many investors like Icahn, share buybacks are the best way to accomplish that,” Ciura writes. “By buying back its own shares and reducing the number of shares outstanding, Apple could produce earnings-per-share growth with its own cash. That would, hopefully, result in multiple expansion as well.”

Read more in the full article here.

[Thanks to MacDailyNews Reader “Fred Mertz” for the heads up.]

Related articles:
Apple gains as Carl Icahn scurries away – February 10, 2014
Carl Icahn sees ‘no reason to persist’ with Apple buyback proposal – February 10, 2014
New York City Comptroller to urge Apple investors to vote against Icahn’s buyback proposal – February 10, 2014
Proxy advisor: Apple shareholders should reject Carl Icahn’s buyback proposal – February 7, 2014
CalPERS criticizes ‘Johnny come lately’ Icahn’s push for additional Apple buybacks – December 12, 2013
Carl Icahn ups Apple stake to $3.6 billion, reiterates calls for larger stock buyback – January 24, 2014


  1. I call BS… I don’t think he has had any influence at all. I read an article that called Icahn a “vulture” recently – a title that fits him well. Why would Tim C and company listen to somebody whose only agenda is short term.

    1. Carl should understand that Apple is only going to use the cash in the USA not the oversea cash to buy back shares. Is he clueless or grand standing? Don’t know and don’t really care. Tim Cook has more shares that Carl’s group. It is like a kid with an allowance telling his dad what to do. It may be cute but holds no weight.

  2. It’s a known fact that rich people always get what they want and what you want, too. The man has billions of dollars and he’s still not satisfied. It’s said that true greed can never be satisfied. He goes from company to company increasing his wealth and yet he doesn’t seem like he stays a very happy man. I would think he could take the money he’s already made and spend time playing golf or lounging at some poolside surrounded by gorgeous bimbos. Instead, he’s wasting his later years whining and trying to accumulate more wealth. I find his behavior rather pitiful. Trying to constantly accumulate more wealth at the age of 77 must indicate some sort of deep-rooted insecurity problems.

  3. I don’t think Carl’s tactics are about increasing wealth per se, but about Power and Influence. If he is able to swaycompanies towards his point of view, that in itself makes him a more valuable commodity, which would be his selling point towards attracting more clients to his firm.

  4. Look, nobody really cares if what Icahn wanted comes to pass. That was never the issue. Most people predicted that Apple would remain aggressive regarding the stock buyback … AT ITS OWN DISCRETION.

    The problem was the reasons behind and the methods of Icahn’s bid. Icahn was trying to take away Apple’s control so he could make a quick buck. He thought he could waltz in, bully them into doing something that they would have likely done anyway, and make a small fortune in the process. The problem with this is, only Apple knows what’s best for Apple, and Apple operates on its own schedule.

    Icahn tried to change that for his own personal gain. He lost. Even if he gets what he publicly claimed he wanted, it won’t be because of his own manipulation. And that is a huge win for Apple.

  5. I think Icahn is just like Ross Perot this time. When Perot was so annoying to the GM Board they just finally paid in something like 800 million to go away. Icahn is doing the same thing to Apple.

    Will Cook pay him to go away?

    1. Icahn is no Perot. Ross Perot builds things up. He’s a proper capitalist, not a leech who can only suck the lifeblood out of established companies then discard their husks once done.

      I mean, could you imagine Icahn ever investing serious money into a fledgeling startup founded by a young maverick who had just been unceremoniously ejected from a previous company he had founded? Perot did exactly that when Steve Jobs founded NeXT.

  6. Carl wants more than enough money money money. Poor little rich boy.

    If Carl wanted ANYTHING good for Apple the company, I’d listen. He doesn’t. I laugh at his sad little frown because he didn’t weasel another $million out of the suckers today.

    Capitalism as parasitism.

    1. Derek, money isn’t the draw and the motivation. The real currency is juice, the neurological payoff in human transactions. In gambling, it’s the kick, not the payout, that feeds the machinery of competition.

      Even in loss, juice flows from believing you influenced the outcome. Playing the game is its own reward.

      At the end of life, what matters is not how many toys you own, but how many peak experiences you have accumulated.

      1. Money is never more than a symbol (although some forms of it are great for making plumbing piles, teeth fillings and electrical contacts). Humans take all their languages and pretend they ‘are’ something more than merely sound symbols made sharable via scratches and pigment on media.

        But this ‘juice’ thing, that’s human tangible chemical manipulation of emotion. This ‘game playing’ chemistry sounds like an addiction scenario from how you describe it. Thankfully, chemical addiction is not in my portfolio of problems.

        As for the end of life: Do we humans really keep track of ‘how many’ of anything we have accumulated? Isn’t it all about the moment, and wanting to keep that ‘moment’ going, or if not that then reliving it over and over again? Is this really a collecting phenomenon? What is actually kept as these ‘peak’ moments tick on by? The addict just wants another fix, and will destroy what ever is necessary to get that fix.

        Oh, we’re talking about modern day Wall-Nut Street! It just coked, I mean clicked. 😉

Reader Feedback

This site uses Akismet to reduce spam. Learn how your comment data is processed.