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

Posted:
in AAPL Investors edited January 2014
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.

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)


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.
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Comments

  • Reply 1 of 81
    hydrhydr Posts: 146member
    I like this guy. He knows whats up. Go Icahn. Go Apple.
  • Reply 2 of 81
    I wish I had that kind of money to invest also.
  • Reply 3 of 81
    Funny how that works.
  • Reply 4 of 81
    gatorguygatorguy Posts: 21,296member
    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.
  • Reply 5 of 81
    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.
  • Reply 6 of 81
    greedy jewish man
  • Reply 7 of 81
    MacProMacPro Posts: 18,457member
    gatorguy wrote: »
    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!
  • Reply 8 of 81
    MacProMacPro Posts: 18,457member
    gimarbazat wrote: »
    greedy jewish man

    Not a nice thing to say. Let's not go there.
  • Reply 9 of 81
    %u201Cdisappointing earnings report%u201D

    How many companies have sold over 50 Million smartphones in the last 3 months?
  • Reply 10 of 81
    ipenipen Posts: 410member

    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.

  • Reply 11 of 81
    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.

  • Reply 12 of 81
    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. :D
  • Reply 13 of 81
    malaxmalax Posts: 1,598member
    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?

  • Reply 14 of 81
    malaxmalax Posts: 1,598member

    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.

  • Reply 15 of 81
    bageljoeybageljoey Posts: 1,763member
    Yeah, doesn't sound right...
    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...
  • Reply 16 of 81
    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.

  • Reply 17 of 81
    rogifanrogifan Posts: 10,669member
    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.
  • Reply 18 of 81
    Quote:

    Originally Posted by brlawyer View Post

     

     

    Although he IS greedy and he IS jewish - so 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.


    Why not include his hair colour, his eye colour, hight, age, sex, then?  Information given isn't for the sake of factuality, its to foreground and implicate.  The poster obviously was invoking a stereotype and it was pretty pointless and offensive.

  • Reply 19 of 81
    gatorguy wrote: »
    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...
  • Reply 20 of 81

    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.  

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