Russia's richest man bullish on Apple, buys $100M in shares
A Russian billionaire recently bought about $100 million in Apple stock, and has publicly declared his faith in the future of the company.
Billionaire Alisher Usmanov thinks Apple is a good buy at its current price. Photo via The Guardian.
Alisher Usmanov, the richest man in Russia, views the recent decline in Apple's share price as a strong investment opportunity, he said in an interview with Bloomberg. Shares of Apple are down nearly 40 percent from their high last September, just before the launch of the iPhone 5.
Apple is a "very promising investment" over the next three years, Usmanov said, though he cautioned that "nothing is eternal." He specifically cited the company's recent decision to spend $100 billion through 2015 on its capital return program.
That money will go toward a new, higher quarterly dividend of $3.05 per common share, as well as a share repurchase program that will amount to $60 billion. The plan is the largest share repurchase authorization in history.
Usmanov is known for making more than a 10-fold return on his investment in Facebook, after initially building his fortune through the tech sector in Alibaba.com and Mail.ru. He's the 35th richest man in the world, with a net worth of $19.8 billion.
With his company's market capitalization off $100 billion from its high last September, Apple Chief Executive Tim Cook said last week that the declining stock price has been "frustrating."
"But Apple remains very strong and we will continue to do what we do best," he said. "We can't control items such as exchange rates and world economies, and even certain cost pressures, but the most important objective for Apple will always be creating innovative products ??and that is directly within our control."
Billionaire Alisher Usmanov thinks Apple is a good buy at its current price. Photo via The Guardian.
Alisher Usmanov, the richest man in Russia, views the recent decline in Apple's share price as a strong investment opportunity, he said in an interview with Bloomberg. Shares of Apple are down nearly 40 percent from their high last September, just before the launch of the iPhone 5.
Apple is a "very promising investment" over the next three years, Usmanov said, though he cautioned that "nothing is eternal." He specifically cited the company's recent decision to spend $100 billion through 2015 on its capital return program.
That money will go toward a new, higher quarterly dividend of $3.05 per common share, as well as a share repurchase program that will amount to $60 billion. The plan is the largest share repurchase authorization in history.
Usmanov is known for making more than a 10-fold return on his investment in Facebook, after initially building his fortune through the tech sector in Alibaba.com and Mail.ru. He's the 35th richest man in the world, with a net worth of $19.8 billion.
With his company's market capitalization off $100 billion from its high last September, Apple Chief Executive Tim Cook said last week that the declining stock price has been "frustrating."
"But Apple remains very strong and we will continue to do what we do best," he said. "We can't control items such as exchange rates and world economies, and even certain cost pressures, but the most important objective for Apple will always be creating innovative products ??and that is directly within our control."
Comments
They make revenue markers and hopes Apple can cross THIER FINISHING LINE. And when Apple doesn't meet their BS, they drop their stock prince. LOL!
In January Apple posted the greatest quarter in Apple history; yet the stock price still went down!!!
There needs to be an investigation because the speculators are stealing money from investors and blaming it on Apple's management.
With a 3 year timeframe, seems like a safe bet that AAPL will hit at least $600 again at some point. With the chance of $800. So 50%-100% gain. Apple can't screw up that bad to tank below $400 long term.
It has little to do with Apple screwing up. Apple is the same company as when the stock was over $700.
Further when Wallstreet is involved nothing is a safe bet. Yet, Apple will be getting a good price on its shares if the stock dips.
The buyback is not trading. At todays prices, Apple is buying back more than 15% of the outstanding shares. Realistically they will end up with 10% as the price goes up. Taking that many shares off the market will probably have some impact.
I'm sure the world is going to thing this oligarch is genius for getting in at $400 a share, but those of us who have been here since it was $4 a share (split-adjusted) will say, "Welcome aboard, what took you so long?"
Quote:
Originally Posted by sog35
But the $60,000,000,000 buyback changes things. What wallstreet hack would be stupid enough to try to tank Apple now? And it won't end after 2015. I'm pretty sure Apple will be raising the divident 10-20% each year from now on and they will probably do another 3 year $60B buyback in 2015.
Well, $60b seems like a lot, but up against leveraged money and divided by 3 years it's not really 'that' much.
Quote:
Originally Posted by jd_in_sb
Playing the stock market is gambling. Apple's price is based on investor mood of the moment and previous highs and lows are irrelevant.
My father always said, in the stock market when someone wins, someone else loses. I never really understood that, as simple as it may seem, until I read a book about the tech bubble.
300 pages later, the author basically said, the guys "in the know" (Wall Street) made all the money, and the little guys lost. That's not to say some on Wall Street didn't lose money, but the general premise is correct, I think.
Quote:
Originally Posted by Fithian
An investor needs to keep AAPL for the long term. I did that when I bought AAPL a few years ago at a split-adjusted $2.50. Nonetheless, I did sell 20% of my AAPL holdings when it was $701. I figured that a 280-bagger meant it was time to diversify. With the dividends, AAPL covers about half of the RMD for my IRA. It looks like AAPL will continue to increase in value, considering the new and updated hardware and software designated for the next two years. Since I am not an analyst, no one will pay any attention to my prediction of a price of $600 with a year.
Can I just say the obvious... good job. I would subscribe to your newsletter.
Smart man. Wall street's insistence on looking at the next few quarters instead of next few years or even longer has ruined many good companies as it pushed them to make bad decisions for the company's long term prospects just to increase the shares in the short term.
Quote:
Originally Posted by christopher126
My father always said, in the stock market when someone wins, someone else loses. I never really understood that, as simple as it may seem, until I read a book about the tech bubble.
300 pages later, the author basically said, the guys "in the know" (Wall Street) made all the money, and the little guys lost. That's not to say some on Wall Street didn't lose money, but the general premise is correct, I think.
With my sincere apologies to your dad, but to say that the stock market is a zero-sum game is overly simplistic. Stocks can be sold for reasons other than "it is overvalued." For example, liquidity. A person may sell at a profit relative to when he bought it; if the stock continues to go up after that, the person that bought it also profits.
The stock market has created more wealth for more people than any other human creation in history.
Yes, there are bubbles. But those exist in every single asset market: e.g., real estate; gold; commodities; bonds, i.e., not just in stocks. Insiders may have made money in the tech bubble (although no one held a gun to the investors' heads, so they also perhaps got what they deserved), but "Wall Street" has been far from infallible: in the real estate/structured finance bubble of 2006-08, it was WS that lost its shirt.
The best response is to hold the stock and now collect the dividends which is much more than you can get at a bank's savings account. Apple is doing the right thing by investing their excess cash in their own company and, by doing so, they are telling these wallstreet con artists to stick it up where the sun does not shine. Apple is the best investment there is right now. It will likely be over $600 before the end of the year. Sell some when it gets high, buy some when it gets low, and collect your dividend along the way.