Carl Icahn says Apple should buy more of its 'dramatically undervalued' stock, reveals valuation of

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  • Reply 61 of 107
    Quote:

    Originally Posted by daveinpublic View Post





    Wow, 550!



    /s

     

    Quote:

    Originally Posted by sog35 View Post

     

     

    Three shares? LOL.

     

    I'm holding 550 shares right now.  If you are not an Apple investor than you don't understand the good Ichan is doing.




    Money is not an infinite resource. If one "investment banker" wants to score big with help of big pile of stock and control that comes with it, then who will be stripped money for this score? Who will lose so he can win?

  • Reply 62 of 107
    retrogusto wrote: »
    Each share represents partial ownership of the company. If there are a million outstanding shares, each share is worth a millionth of the company. If the company has extra cash, they can different things with it to increase value. If they think the company is undervalued, they can buy back shares and retire them, which means each remaining share will be worth a larger percentage of the company (but of course it will be a larger percentage of a company with less cash). If analysts do their math right, this will increase numbers like Earnings Per Share and Price-Earnings ratio, so to some degree it can help investors see the stock as more valuable, even if initially the value is kind of just redistributed. It also demonstrates to everyone that management has faith in the company's future prospects.

    But it should be noted that the company's cash, like the rest of the company, belongs to the shareholders. So if Carl owns $3 billion in stock, about $637 million of Apple's cash technically belongs to him, but is not directly controlled by him. If somebody else was controlling that much of my money, and I had strong opinions about what should be done with it, I'd probably speak up too.

    Very nice explanation !

    retrogusto wrote: »
    What I don't understand is why they can't use the foreign cash to do this without having to repatriate it first. Companies buy Apple stock with foreign cash every day, through brokers. You can buy the shares, or depositary receipts denominated in other currencies that are essentially contracts that designate you as the owner of the actual shares.

    I am not an expert, but I think that Apple Inc (the US company with AAPL shares) must use its own money in order to perform buy back in US, and money overseas is not directly owned by AAPL.
  • Reply 63 of 107
    Quote:
    Originally Posted by margus1000 View Post

     

    Oh sweet naive ...

    If Icahn can bring Apple down, he can easily earn 30-40 billions or even more. What's more important, he will do something that no one would think is possible. He will be legend - the man who took Apple down to dirt. 

    Everything he's done so far goes point by point by textbook "What is hostile takeover and how to perform it". Only time he's done something wrong was trying to oust Cook before right time. He understood his mistake and right now it's going as planned. I just hope that Lenovo outbids Samsung with iPhone. iPhone Galaxy would be horrible.




    And if I could eat the whole company I would be the biggest buffalo in all Estonia. What is common to both theses statements is neither one makes a lick of sense. I can see him closing in on the 308.55B he would need wrest control of the company, at 5B he's almost there! /s

     

     

  • Reply 64 of 107
    Quote:

    Originally Posted by sog35 View Post

     

     

    Yes he does know better.

     

    Want proof?  18 months ago these "combined evaluations of all other market participants" that you put so much trust in had Apple valued at $55.


     

    THIS.

     

    Apple gets constantly beat up in the media... that was a bad time overall for shareholders.

     

    I like the fact that he wants more buy-backs. From what I understand it also helps put a floor under the stock's value to help it better weather times like that.

  • Reply 65 of 107
    jungmarkjungmark Posts: 6,817member
    Go away you greedy Bastard.
  • Reply 66 of 107
    kibitzerkibitzer Posts: 1,114member
    Quote:
    Originally Posted by AndreiD View Post

     

     

    All good advice Sir in general. But one has to make a distinction between how a company is ran and able to generate revenue and profits for it's investors and how a company's stock is traded and valued. As for your own statement: "Stock prices are strongly influenced by irrational reasoning" i couldn't agree more. Despite the fact that Apple overall reported record after records, still the stock plummeted in the past few years. 

     

    So for the serious investor that's on the ride for the long term, Apple's decisions in terms of product strategy and Apple's financial reports, is quite enough. For the stock speculator, actual price of the stock right NOW, is probably much more appealing, milking where there is scent of milk. That's why you see a speculator much more active on the stock market, selling at highs and buying at lows, manipulating and milking without any interest, other than his own personal gain.


    "As for your own statement: 'Stock prices are strongly influenced by irrational reasoning' i couldn't agree more."

     

    ?

     

    I never said that. Maybe someone else did, but I didn't. There's a lot of irrationality in the marketplace, true, but it varies from day to day and according to circumstance.

     

    As to speculators, so what. Everyone, including you and I, attempts to "manipulate and milk" in one way or another and to one degree or another for our own "personal gain." Unfair manipulation is something different and frequently unlawful.

  • Reply 67 of 107
    kibitzerkibitzer Posts: 1,114member
    Quote:

    Originally Posted by Flaneur View Post





    You might better say "ovine"—sheeplike. Come to think of it, he does resemble a wolf. I'm having trouble with border collie.



    I thought about ovine, but it kept bringing to mind the Studs Lonigan trilogy, where James T. Farrell writes about the bums in the 1920s in the sheep pens at the Chicago Stockyards - running with their pants around their ankles after the innocent ovines with intent to deflower!

     

    Bovines are usually too big to stand still for that stuff, and besides, they don't have any wool to hang onto.

     

    So then - a wolf in border collie clothing?

  • Reply 68 of 107
    pfisherpfisher Posts: 758member
    Quote:

    Originally Posted by sog35 View Post

     

     

    Well by having an Apple heavy portfolio I destroyed the market the last 24 months.

     

    For beginners it is best to have index funds.


     

    Quote:

    Originally Posted by sog35 View Post

     

     

    Well by having an Apple heavy portfolio I destroyed the market the last 24 months.

     

    For beginners it is best to have index funds.


     

    True, for a lot of stocks you could have destroyed the market. And you could have lost your shorts, too, on a lot of stocks.

     

    Index funds are not just for beginner.



    I would say that individual stocks are for real gamblers. In fact, some "gamblers" have much of their money in index funds and have some money set aside for individual stocks.

     

    It's easy to look in the rear view mirror and say, "Yeah, that was a smart/dumb move".

     

    Again, only 20% of stock fund managers beat index funds. Odd are, most all people in most cases are going to get the same results.

  • Reply 69 of 107
    kibitzerkibitzer Posts: 1,114member
    Quote:
    Originally Posted by margus1000 View Post

     

    Oh sweet naive ...

    If Icahn can bring Apple down, he can easily earn 30-40 billions or even more. What's more important, he will do something that no one would think is possible. He will be legend - the man who took Apple down to dirt. 

    Everything he's done so far goes point by point by textbook "What is hostile takeover and how to perform it". Only time he's done something wrong was trying to oust Cook before right time. He understood his mistake and right now it's going as planned. I just hope that Lenovo outbids Samsung with iPhone. iPhone Galaxy would be horrible.




    So .. let's say that Apple heeds Icahn's advice, increases its stock buyback and the price of AAPL shares subsequently doubles. Icahn makes a huge paper profit but so does every other Apple shareholder. A rising tide lifts all ships. Explain to me what's wrong with that.

     

    As to hostile takeover, give me a break. Given Apple's market cap compared to Icahn's resources, that would be akin to a pissant crawling up an elephant's leg with rape on its mind.

  • Reply 70 of 107
    cnocbuicnocbui Posts: 3,613member

    Dear Tim

     

    Please issue lots more Apple shares.

  • Reply 71 of 107
    jungmarkjungmark Posts: 6,817member
    retrogusto wrote: »
    Each share represents partial ownership of the company. If there are a million outstanding shares, each share is worth a millionth of the company. If the company has extra cash, they can different things with it to increase value. If they think the company is undervalued, they can buy back shares and retire them, which means each remaining share will be worth a larger percentage of the company (but of course it will be a larger percentage of a company with less cash). If analysts do their math right, this will increase numbers like Earnings Per Share and Price-Earnings ratio, so to some degree it can help investors see the stock as more valuable, even if initially the value is kind of just redistributed. It also demonstrates to everyone that management has faith in the company's future prospects.

    But it should be noted that the company's cash, like the rest of the company, belongs to the shareholders. So if Carl owns $3 billion in stock, about $637 million of Apple's cash technically belongs to him, but is not directly controlled by him. If somebody else was controlling that much of my money, and I had strong opinions about what should be done with it, I'd probably speak up too.

    What I don't understand is why they can't use the foreign cash to do this without having to repatriate it first. Companies buy Apple stock with foreign cash every day, through brokers. You can buy the shares, or depositary receipts denominated in other currencies that are essentially contracts that designate you as the owner of the actual shares.

    Hogwash. Crazy Carl doesn't "own" $637 MM in Apple's cash. If he wants control, tell him to sell his shares.

    As for using foreign funds to buy stock. They buy it to retire the stock and not to put it in a stock/investment portfolio.
  • Reply 72 of 107
    jpellinojpellino Posts: 651member
    Translation: My average pre-split position on AAPL is $450 and I want it to go to $1,400 just because I want it to and I imagine the other billionaire market jockeys will laugh at me if I don't.
  • Reply 73 of 107
    jungmarkjungmark Posts: 6,817member
    kibitzer wrote: »

    So .. let's say that Apple heeds Icahn's advice, increases its stock buyback and the price of AAPL shares subsequently doubles. Icahn makes a huge paper profit but so does every other Apple shareholder. A rising tide lifts all ships. Explain to me what's wrong with that.

    As to hostile takeover, give me a break. Given Apple's market cap compared to Icahn's resources, that would be akin to a pissant crawling up an elephant's leg with rape on its mind.

    You're just thinking of just Icahn. He can influence many people (shareholders and middlemen) and gain enough votes to elect his own board of directors nominees. And boom, the BoD ousts cook and installs a Carl acolyte. Before you know it, the puppet CEO dismantles Apple for the sake of $$$.
  • Reply 74 of 107
    jpellinojpellino Posts: 651member
    Quote:

    Originally Posted by Kibitzer View Post

     



    So .. let's say that Apple heeds Icahn's advice, increases its stock buyback and the price of AAPL shares subsequently doubles. Icahn makes a huge paper profit but so does every other Apple shareholder. A rising tide lifts all ships. Explain to me what's wrong with that.


     

    The rapid run-up to $203 ($1,400 re-split) has the potential to trigger a massive selloff by everyone who was in up to $100/$700.  Icahn is in apple at $450 pre-split.  There is one and only one reason he wants this at $200.  What do you think he'll do when it hits the point he wants?  Hold?  Not likely.  

  • Reply 75 of 107
    jungmark wrote: »
    Hogwash. Crazy Carl doesn't "own" $637 MM in Apple's cash. If he wants control, tell him to sell his shares.

    As for using foreign funds to buy stock. They buy it to retire the stock and not to put it in a stock/investment portfolio.

    To whom does Apple's cash belong, if not to the owners of Apple? If he owned 100% of Apple, would he not own 100% of its cash? Obviously, like I said, he doesn't control the cash, so it's not "his" in the sense that he can use it to buy a gift for his mom, but he's roughly a .5% owner of Apple (if I got the math right), which includes all of the company's assets. And there may be debate about what is best for the company and its shareholders (including myself, since 2001), but presumably what's good for the big investors is good for the smaller investors too. What may put people at odds is if something good for shareholders in the short term but bad for the company and/or shareholders in the longer term. Given the amount of cash Apple has and how much it adds to the stockpile each quarter, it's not hard to see Icahn's point if you think the company is going to continue to grow. Even the people who vocally disagree with him don't seem to be coming up with a lot of better suggestions about how to deploy the cash to best advantage. Should it sit in the bank with minuscule interest? Should they invest it in another company that's even better than Apple? It's hard to invest large sums of money without moving the market, but at least if you invest it back in Apple, you're moving the market in a way that benefits the shareholders.

    In my previous post, I do say that they retire the shares, so I'm not sure why you are reiterating that here as if it was a clarification. I would imagine that once Apple owns the shares, they can retire them as they see fit, but I don't understand the legalities of how shares are retired. Maybe if they bought them with foreign cash they would be technically owned by a foreign subsidiary as opposed to Apple, inc. (U.S.), which might make it impossible to legally retire the shares.
  • Reply 76 of 107
    In my opinion, Apple has a lower valuation compared to its peers because it is an unlikely takeover target while at the same time it is very difficult to imagine perpetual growth without knowing what new product categories are being considered.

    More importantly, Tim Cook won't live forever and having a good indication of who would be his successor would dramatically increase confidence therefore Apple's valuations. Everyone pretty much suspected Tim Cook would succeed Steve Jobs which this expect ion did keep the stock price if not the valuation higher.
  • Reply 77 of 107
    tmaytmay Posts: 5,167member
    Quote:

    Originally Posted by sog35 View Post

     

     

    You look it up.

     

    Ichan pushed for a BIGGER buyback and Apple listen to Ichan and increased the buyback from $60B to $90B


    Again, no correlation.

  • Reply 78 of 107
    Quote:

    Originally Posted by YvesVilleneuve View Post



    More importantly, Tim Cook won't live forever and having a good indication of who would be his successor would dramatically increase confidence therefore Apple's valuations. Everyone pretty much suspected Tim Cook would succeed Steve Jobs which this expect ion did keep the stock price if not the valuation higher.

     

    Holy moly, are we already trying to prepare for Tim Cook's inevitable death???

  • Reply 79 of 107
    kibitzerkibitzer Posts: 1,114member
    jpellino wrote: »
    The rapid run-up to $203 ($1,400 re-split) has the potential to trigger a massive selloff by everyone who was in up to $100/$700.  Icahn is in apple at $450 pre-split.  There is one and only one reason he wants this at $200.  What do you think he'll do when it hits the point he wants?  Hold?  Not likely.  
    So what? Selling off is how you monetize your investment. Selling off a large holding too quickly is dumping, which tends to depress the market price. That wouldn't make sense. Look - I bought AAPL in late 2008 under $100 and sold 44 months later for around $587 for an annualized percentage capital gain of about 60%. Two years later now, the stock is going at a pre-split equivalent of around $700, so the recent growth rate has been quite a bit less. If Icahn can provide the impetus for doubling the share price over the next 18 months, we could see a reprise of the prior growth rate in the near term. I'm considering a buy. We'll see over the next couple months.
  • Reply 80 of 107
    thepixeldocthepixeldoc Posts: 2,257member
    sog35 wrote: »
    You are not making sense.

    Ichan said Apple should increase the buyback last year when the shares were $60-$70.  He was right.  The shares are now $100+

    Cooperman/Anderssen are just jealous that they don't have the powerful influence that Ichan has.  Ichan's tract record of success is undeniable.  That's why the market respects his opinion and follow many of his investments.

    Every day we have dozens of Apple HATERS in the media and psudo-Media bashing Apple 24 hours a day.  Yet Ichan is praising Apple and you want to bash him?  Your negative energy is being directly to the wrong people.

    I agree with you... but I keep on getting distracted by your misspelling... thinking he's the new 4chan.

    Icahn please.
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