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Carl Icahn invests another $500M in Apple after shares slide

post #1 of 80
Thread Starter 
With the share price of Apple dropping more than $40 in Tuesday morning trading following a disappointing earnings report, billionaire investor Carl Icahn announced he has bought another $500 million stake in the company.

Icahn


As he has done in recent months, Icahn took to his official Twitter account to announce his purchase. Unsurprisingly, he also further pushed his desire for Apple to increase its share buyback program.

"My buying seems to be going neck-and-neck with Apple's buyback program, but hope they win that race," he wrote.

The announcement comes less than a week after Icahn announced he had placed another $500 million bet on Apple shares. That means Icahn has put over $1 billion into Apple in the last week.

January 28, 2014


Though Icahn has been critical of Apple's board of directors for their growing cash hoard, he believes the company itself has a bright future ahead of it. On numerous occasions, he has said his investment in AAPL is a "no brainer."

The activist investor, who has a reputation for using his considerable sway with publicly traded companies, believes Apple should spend the entirety of its $158.8 billion in cash on its own shares. However, he has made a more moderate proposal to shareholders, asking by proxy vote that Apple invest $50 billion immediately.

Apple has advised that shareholders vote against the proposal at its upcoming annual investor meeting, saying that its board is already "thoughtfully considering options for returning additional cash to shareholders."

Shares of Apple tumbled on Tuesday after the company reported its December quarter earnings on Monday. Though it was a record quarter for the company, investors had anticipated more growth, and were particularly bothered by lower-than-expected iPhone sales of 51 million units.
post #2 of 80
I like this guy. He knows whats up. Go Icahn. Go Apple.
post #3 of 80
I wish I had that kind of money to invest also.
post #4 of 80
Funny how that works.
post #5 of 80
I'm not a seasoned nor savvy investor, but IMO his weekly announcements are smelling more and more like I-Cahn-Manipulate-The-Stock-Market. Just convinces me more I'm right to avoid the market for the most part.
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melior diabolus quem scies
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post #6 of 80
It is amazing how the cries for a larger share buy back keep growing. A larger buy back will cause Apple's credit rating to be decreased. Moody's has already announced a warning about this. But the warning is being ignored due to greed for Apple's money.
post #7 of 80
Quote:
Originally Posted by Gatorguy View Post

I'm not a seasoned nor savvy investor, but IMO his weekly announcements are smelling more and more like I-Cahn-Manipulate-The-Stock-Market. Just convinces me more I'm right to avoid the market for the most part.

I don't think he manipulated it to be fair, he has been shouting AAPL is under priced all along. All I think he said is Apple should buy more back while it is ridiculously low.

I am just glad all my AAPL was mostly bought well under $100, I can happily sit and wait for sanity to prevail and enjoy the dividends. I do feel for the folks that climbed on board in more recent times. This whole thing is getting silly though, Apple does great but not as well as some folks had guessed they might and the stock tanks. Really sensible logic ... NOT!
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post #8 of 80
%u201Cdisappointing earnings report%u201D

How many companies have sold over 50 Million smartphones in the last 3 months?
post #9 of 80

This guy is trying to average buy to lower the base of what he bought a week ago.  If Apple doesn't listen to him for the buy back program, watch out that he may start to dump the shares.  If he's really into long term investment, he should have patient and not pressure Apple so hard on buy back.

post #10 of 80
Quote:
Originally Posted by hydr View Post

I like this guy. He knows whats up. Go Icahn. Go Apple.


Oh... please share how he knows 'whats up'?

Did Apple share their plans with him? Hmmm no, that would be illegal (I hope). Does he have a mole on the inside, no that would be illegal too.  

Barring further evidence, IMO- this guy is either a master manipulator, aka flimflam man, aka confidence man, (which should be illegal but is usually not to the 1%'rs) or he's a plain ol crook.

Notice he does not say he knows what Apple will do but has 'confidence'. Yup... flimflam man. Too smart to be an outright crook.

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Hokey religions and ancient weapons are no match for a good blaster by your side, kid.
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post #11 of 80
Hmmm. Icahn talks to the board regularly. He buys at the year highs and the year lows. He calls the stock a 'no-brainer'. Wonder what he knows about the upcoming pipeline? That'll do pig, that'll do. 1biggrin.gif
What is really factored into the price is a kind of perpetual sense of disbelief that any company could be as good as Apple is. ~Retrogusto
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What is really factored into the price is a kind of perpetual sense of disbelief that any company could be as good as Apple is. ~Retrogusto
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post #12 of 80
Quote:
Originally Posted by leavingthebigG View Post

It is amazing how the cries for a larger share buy back keep growing. A larger buy back will cause Apple's credit rating to be decreased. Moody's has already announced a warning about this. But the warning is being ignored due to greed for Apple's money.

How can that possibly be when in the history of the world there has never been a company with as much free cash as Apple in recent years?

post #13 of 80

His move makes perfect sense.  He bought half a billion dollars worth a week ago (or so).  Then Apple announced their earning that were perfectly in line with what they had been saying they would be (i.e., no surprises, no reason to believe Apple is anywhere other than they said they were) and yet the price is 8% lower.  Why wouldn't be buy more shares?  It's the sellers who have some explaining to do.

post #14 of 80
Yeah, doesn't sound right...
Quote:
Originally Posted by leavingthebigG View Post

It is amazing how the cries for a larger share buy back keep growing. A larger buy back will cause Apple's credit rating to be decreased. Moody's has already announced a warning about this. But the warning is being ignored due to greed for Apple's money.
I couldn't figure this out at first. Fortunately, there are the internets to give us facts...

Moody's did not lower Apple's credit rating, they *assigned* Apple a rating last year. Apple was completely debt free for the best part of a decade, so they did not have a rating at all. As it turns out, they were assigned the second highest rating possible (AA1) despite their enormous cash reserves.
Moody's did not lower anything (heck, for fun, go check out their ratings from 10 or 15 years ago!!) nor did they "warn" about Apple. They did note that Apple is making the bulk of their money in sectors where players tend to rise and fall fast--very few high-tech firms (especially phone manufacturers) stay at the top for long. See Palm, Nokia, RIM, Erricson...
Edited by Bageljoey - 1/28/14 at 10:35am
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post #15 of 80
Quote:
Originally Posted by digitalclips View Post


Not a nice thing to say. Let's not go there.

 

Not factually wrong at all. More than that: he is an annoying press-starved idiot.

 

In any case, what is he going to do with all that money once he finally gets to wear a wooden suit? Not much, I guess.

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post #16 of 80
9to5Mac is reporting that Apple is testing a new version of Apple TV that combines ATV with Airport Express into one product. The focus of this new ATV would be gaming. Apple has also tested one with a TV tuner as well. This could be a very cool product. I know I'd buy one. It would be nice if they has something to announce before WWDC but my guess is that's where it would happen. Of course these are just rumors, but Apple did update their store and ATV is now its own product category rather than being buried inside the iPod category.
post #17 of 80
Quote:
Originally Posted by Gatorguy View Post

I'm not a seasoned nor savvy investor, but IMO his weekly announcements are smelling more and more like I-Cahn-Manipulate-The-Stock-Market. Just convinces me more I'm right to avoid the market for the most part.

I'd say it is more like an Apple Fanboy (like myself) always coming to the defense of the stock... and arguably not being able to see the forest from the trees.

This week I am going to have to cut my position in half. It's a sad feeling, but being an Apple stockholder makes me do irrational things. Like not returning our iPads after the crashing problems or defending the iPhone when something else is actually better for a given person's needs...
post #18 of 80

He won't dump anything until the share price climbs above his average position.  Which is what will happen if Apple listens to him and executes the buyback.  Which is the only reason he needs Apple to do this.  It makes no sense for them to do so for business reasons.  Investors need to remember, they are just that - investors.  Warren Buffett build his investments on stable companies that make needed things, and he lets the people who know how to run those businesses continue to run them.  Last I checked, he had more dough than Carl Icahn.  Like three times as much.  I'm with Warren.  Worst case for Icahn is he has to keep AAPL long term which is where the smart money has been for the past 30 years.  He's just looking to make some money fast and is kicking himself for not buying AAPL five years ago.  Not my problem.  Not your problem.  Not the board's problem.  

post #19 of 80
Quote:
Originally Posted by ipen View Post
 

This guy is trying to average buy to lower the base of what he bought a week ago.  If Apple doesn't listen to him for the buy back program, watch out that he may start to dump the shares.  If he's really into long term investment, he should have patient and not pressure Apple so hard on buy back.

I am not personally convince that if Apple bough back more share thes stock will be any higher. I think Icahn is playing a game which he can not win. Part of the reason the stock drop so much was due to the fact that the stock is heavily shorted so the stock had no choose but to go down, The analysis set the playing field for that failure to occur and nothing Icahn can do to stop it. I am now convinced after yesterday and seeing those kinds of numbers that Apple will never trade nothing of $600 again, unless they create a new market which no one is playing in right now.

 

Icahn already lost $300M on paper due to this and I do not expect him to make any significant amount of money on what he owns in Apple, well he collecting a large dividend check so maybe he'll break even in a few years.

post #20 of 80
Quote:
Originally Posted by malax View Post

How can that possibly be when in the history of the world there has never been a company with as much free cash as Apple in recent years?

That is where the greed is coming in.

Wall Street cried for a dividend and the Apple gave the dividend. Wall Street was happy for a few weeks.

Then David Einhorn decides to propose a super preferred share type of stock and then took Apple to court to prevent shareholders from voting for preferred shares.

Then Wall Street started clamoring for a larger dividendend.

Then Apple became a company that could not innovate.

Speeding forward, Carl Icahn decides he knows what Apple needs to do for its shareholders... Spend an additional $150 billion to purchase more stock. Credit rating be damned. Available cash for any crisis be damned. Cash for R&D be damned. Make Carl richer as fast as possible is all he cares about. Carl knows Apple is legally prevented from purchasing US Bonds with foreign capital, which is another proof he does not care for the continued financial well-being of the company.
post #21 of 80
Wasn't the buy back suppose to increase Apple's stock price exponentially? Or was that Crazy Carl's followers stating that.
post #22 of 80
Quote:
Originally Posted by Rogifan View Post

9to5Mac is reporting that Apple is testing a new version of Apple TV that combines ATV with Airport Express into one product. The focus of this new ATV would be gaming. Apple has also tested one with a TV tuner as well. This could be a very cool product. I know I'd buy one. It would be nice if they has something to announce before WWDC but my guess is that's where it would happen. Of course these are just rumors, but Apple did update their store and ATV is now its own product category rather than being buried inside the iPod category.

 

In my opinion, the best next thing for Apple is to release a significantly enhanced Apple TV box.  There are 2 different directions Apple can go.  

 

One is add a tuner with Tivo capability and make it the best Tivo like device on the market, hopefully making it the standard that all cable companies want to provide to customers as well as selling it directly, giving Apple command over people's living rooms just like they did with phones and tablets.

 

The other option is to usher in a new era of TV where content providers bypass cable companies and put fresh content to a new Apple TV, something that no one has been able to do yet (Netflix and Hulu still have a limited selection and sloppy seconds).  That way most shows are on demand, and live TV can be available too.  This is more of a legal/contractual challenge than anything, but maybe Apple could pull it off.

post #23 of 80
Quote:
Originally Posted by leavingthebigG View Post

It is amazing how the cries for a larger share buy back keep growing. A larger buy back will cause Apple's credit rating to be decreased. Moody's has already announced a warning about this. But the warning is being ignored due to greed for Apple's money.


What on Earth do you think Apple needs a credit rating for?  They could buy Moody's with pocket change.

post #24 of 80
Quote:
Originally Posted by techguy911 View Post

In my opinion, the best next thing for Apple is to release a significantly enhanced Apple TV box.  There are 2 different directions Apple can go.  

One is add a tuner with Tivo capability and make it the best Tivo like device on the market, hopefully making it the standard that all cable companies want to provide to customers as well as selling it directly, giving Apple command over people's living rooms just like they did with phones and tablets.

The other option is to usher in a new era of TV where content providers bypass cable companies and put fresh content to a new Apple TV, something that no one has been able to do yet (Netflix and Hulu still have a limited selection and sloppy seconds).  That way most shows are on demand, and live TV can be available too.  This is more of a legal/contractual challenge than anything, but maybe Apple could pull it off.
Yes to either or both of these. Along with a new ATV UI.
post #25 of 80

 

Icahn whiners take a look :lol: 

post #26 of 80
Quote:
Originally Posted by Bageljoey View Post

Yeah, doesn't sound right...
I couldn't figure this out at first. Fortunately, there are the internets to give us facts...

Moody's did not lower Apple's credit rating, they *assigned* Apple a rating last year. Apple was completely debt free for the best part of a decade, so they did not have a rating at all. As it turns out, they were assigned the second highest rating possible (AA1) despite their enormous cash reserves.
Moody's did not lower anything (heck, for fun, go check out their ratings from 10 or 15 years ago!!) nor did they "warn" about Apple. They did note that Apple is making the bulk of their money in sectors where players tend to rise and fall fast--very few high-tech firms (especially phone manufacturers) stay at the top for long. See Palm, Nokia, RIM, Erricson...

You did not search enough. Before that though, I did not state Apple's credit rating had been lowered. I stated, Moody's warned Apple as follows...

On December 5, 2013, Gerald Granovsky of Moody's wrote... "But despite is massive and growing cash balance of $147 billion at 28 September, the company would face heightened credit risk if It were to issue significantly more debt to accommodate calls to boost shareholder returns."
post #27 of 80
Quote:
Originally Posted by cnocbui View Post


What on Earth do you think Apple needs a credit rating for?  They could buy Moody's with pocket change.

You made me smile. Thanks.
post #28 of 80

So....let met get this straight:  Apple has best ever financial quarter and investors are disappointed?  This doesn't make a lick of sense!

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post #29 of 80
Quote:
Originally Posted by cnocbui View Post
 


What on Earth do you think Apple needs a credit rating for?  They could buy Moody's with pocket change.

The bond sales that are facilitating the stock buybacks are subject to credit rating.

post #30 of 80
Quote:
Originally Posted by brlawyer View Post

Not factually wrong at all. More than that: he is an annoying press-starved idiot.

In any case, what is he going to do with all that money once he finally gets to wear a wooden suit? Not much, I guess.

I simply was referring to the reference to a person's religion in the condemnation posted. This from an atheist I should add. Call him out for anything, but I just don't see the need to add a persons's age, sex, religion or color etc. in with the insults. Stereotyping is just plain silly.

It seems the OP was removed by the mods unless I'm going blind. I don't see it now, so moot anyway.
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post #31 of 80
Quote:
Originally Posted by AppleInsider View Post
 

Just bought $500 mln more $AAPL shares. My buying seems to be going neck-and-neck with Apple's buyback program, but hope they win that race.

— Carl Icahn (@Carl_C_Icahn)

January 28, 2014

 

When he buys at least $16 Billion worth he can say this.

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post #32 of 80
Quote:
Originally Posted by Maestro64 View Post
 

I am not personally convince that if Apple bough back more share thes stock will be any higher. I think Icahn is playing a game which he can not win. Part of the reason the stock drop so much was due to the fact that the stock is heavily shorted so the stock had no choose but to go down, The analysis set the playing field for that failure to occur and nothing Icahn can do to stop it. I am now convinced after yesterday and seeing those kinds of numbers that Apple will never trade nothing of $600 again, unless they create a new market which no one is playing in right now.

 

Icahn already lost $300M on paper due to this and I do not expect him to make any significant amount of money on what he owns in Apple, well he collecting a large dividend check so maybe he'll break even in a few years.

 

Except he is still way ahead having bought 2 Billion worth at 460.

 

I wouldn't say no to that kind of money over a few months.

 

Your comments indicate you are one of the sheep that people like Icahn love to fleece.

Better than my Bose, better than my Skullcandy's, listening to Mozart through my LeBron James limited edition PowerBeats by Dre is almost as good as my Sennheisers.
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post #33 of 80
Quote:
Originally Posted by ipen View Post
 

This guy is trying to average buy to lower the base of what he bought a week ago.  If Apple doesn't listen to him for the buy back program, watch out that he may start to dump the shares.  If he's really into long term investment, he should have patient and not pressure Apple so hard on buy back.

 

What?

 

"Dump" almost 2%?

 

Profit take on what he already has.

Better than my Bose, better than my Skullcandy's, listening to Mozart through my LeBron James limited edition PowerBeats by Dre is almost as good as my Sennheisers.
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post #34 of 80
Quote:
Originally Posted by jungmark View Post

Wasn't the buy back suppose to increase Apple's stock price exponentially? Or was that Crazy Carl's followers stating that.

It probably did, by about $30 - $50 (from the mid-400s). The component of the gain is still probably there. What's been wiped out is perhaps mostly the optimism associated with China and iPhone growth.

post #35 of 80
I’ve been thinking more about Tim Cook today and what his future as Apple CEO is. There’s no doubt that Cook lives and breathes Apple. Apple is his life. And I don’t think there’s anyone who cares more about Apple than Cook (similar to Ballmer at Microsoft). I get the sense that employees like Cook and that his direct reports like working for him. While product ideas might not come from Cook directly I don’t get the sense that he’s shooting down good ideas. I’ve never heard stories about Apple working on some cool project and Cook cancelling it. So it seems like Cook is fostering the right culture for innovation.

But then I listen to Cook when being interviewed by Walt Mossberg or his comments during earnings calls and it’s sometimes hard to listen to. Apple has been on defense now for two years with everyone and their brother questioning Apple’s strategies and whether the company is innovating, whether it can produce another blockbuster like the iPhone. And Cook just doesn’t seem to have a good answer for this. I listen to him on conference calls and never get much confidence from what he says. Like yesterday when he got the inevitable innovation questions. Cook should have knocked it out of the park. He should have said Apple is working on lots of cool stuff but they’re not going to bring it to market until it’s ready. They’re not going to rush a product to market just to feed the beast and the need for new, new new. And then say what Federighi and Ive have said in the past – that new and different is easy but better is hard, and Apple is interested in doing things that are better, not just new or different. Or like Ive said in the iPhone 5S video – that it’s not about technology for technology’s sake; it’s about doing something that enhances the user experience. Cook needs to do a better job of explaining why Apple doesn’t crank out new stuff left and right. Sure the market should already know this, but it seems these days they need to be reminded and reminded often. Perhaps Apple should have someone besides Cook doing these interviews and driving the conference calls. Someone that can do a better job of articulating Apple’s MO.
post #36 of 80
Originally Posted by Rogifan View Post
Someone that can do a better job of articulating Apple’s MO.

 

I imagine that you’re dead on about Cook. Thing is, no one can explain that better than he, because of the position he has within the whole ecosystem.

 

He needs to write an open letter articulating this. Best of both worlds. It’s him saying it, so the detractors can’t claim it’s “not Cook’s sentiment” and it’s a pre-planned statement rather than spur of the moment, so the detractors can’t claim it’s “not genuine because it’s an Apple representative saying it” and he won’t miss out on anything.

 

Not that he can’t speak the truth spur of the moment. Since he believes what’s being said…  I had a better way of explaining it, but I feel worthless right now, so I’ll do it shorthand: 

 

“If you tell the truth, you don’t have to remember anything.” – Mark Twain 

 

Thing is, you can still forget things, and that’s enough to get people on your case. He ought to write a letter.

Originally Posted by Marvin

The only thing more insecure than Android’s OS is its userbase.
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Originally Posted by Marvin

The only thing more insecure than Android’s OS is its userbase.
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post #37 of 80

Why is he buying so many Apple stock just as Apple is losing so much market share all over the world? There are no bigger screen, more affordable iPhones or new products coming.

post #38 of 80
Originally Posted by peter236 View Post
Why is he buying so many Apple stock just as Apple is losing so much market share all over the world? There are no bigger screen, more affordable iPhones or new products coming.

 

/s

Originally Posted by Marvin

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Originally Posted by Marvin

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post #39 of 80
Quote:
Originally Posted by peter236 View Post
 

Why is he buying so many Apple stock just as Apple is losing so much market share all over the world? There are no bigger screen, more affordable iPhones or new products coming.

 

And that right there explains why he's a multi-billionaire and you probably aren't...(?)  :))

 

No offense intended. Just pointing out the obvious. (I'm not a billionaire either, by the way, but I get why he's buying in.)

 

Here's a super-mini explanation:

 

The market (and the competitive base) is GROWING. Apple is also GROWING.

 

Apple appears to be "losing market share" (only a marginally important measure where Apple is concerned) because the combined products of dozens of companies IN TOTAL are growing together faster than Apple can alone. No single company can keep pace with this growth, and still put out high quality, focused products, like Apple does. And yet, Apple is still the most valuable company in the world, and growing, still reaping the vast majority of profit in their space, which is also growing, and themselves growing at a healthy pace.

 

Apple is not Samsung. They don't do "junk". Samsung increases "market share" while losing profit.

 

Apple just had yet another record-breaking quarter. $13 BILLION in profit selling 77 MILLION iOS devices. In a single quarter.

 

That's why he's buying the stock. He sees where they are, and where they're going more in FACT than the fiction of "analyst land"...

 

OK?

post #40 of 80
Quote:
Originally Posted by Tallest Skil View Post

I imagine that you’re dead on about Cook. Thing is, no one can explain that better than he, because of the position he has within the whole ecosystem.

He needs to write an open letter articulating this. Best of both worlds. It’s him saying it, so the detractors can’t claim it’s “not Cook’s sentiment” and it’s a pre-planned statement rather than spur of the moment, so the detractors can’t claim it’s “not genuine because it’s an Apple representative saying it” and he won’t miss out on anything.

Not that he can’t speak the truth spur of the moment. Since he believes what’s being said…  I had a better way of explaining it, but I feel worthless right now, so I’ll do it shorthand: 

“If you tell the truth, you don’t have to remember anything.” – Mark Twain 

Thing is, you can still forget things, and that’s enough to get people on your case. He ought to write a letter.
You're probably right. It's just that Cook is not a great public speaker. Maybe a letter is the way to go. Just something to counter the perception that has unfortunately become reality.
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