Carl Icahn, David Einhorn cut Apple positions amid hedge fund titration

Posted:
in AAPL Investors edited February 2016
A series of U.S. Securities and Exchange Commission filings reveal activist investor Carl Icahn and David Einhorn's Greenlight Capital both shed Apple stock in the fourth quarter of 2015 after bullish prospects




According to 13F filings released on Tuesday, Icahn reduced his position in Apple by 7 million shares to 45.8 million shares, down 13 percent from the previous quarter, while hedge fund Greenlight sold off 44 percent of its Apple holdings to end the year with 6.3 million shares.

As reported by Reuters, other institutional filings show Adage Capital Partners and Blue Ridge Capital cut their stakes in Apple by a respective 5 percent and 11 percent over the same period. Adage now owns 8.1 million shares, while Blue Ridge holds 2 million shares. Passport Capital held no Apple shares as of Dec. 31 after reporting 100,642 owned shares in September. Appaloosa Management also dropped about 1.25 million shares, a 3 percent sequential decline.

At least two major funds went in on Apple, however, with Bridgewater Associates raising its stake by 19 percent to 327,452 shares, and Tiger Global Management reporting a new position of 10.6 million shares as of Dec. 31.

Icahn and Einhorn, while critical of Apple's financial management decision, have long viewed the company's stock as undervalued. Last May, Icahn pegged a target price of $240 per share, more than $100 above the price at which Apple was trading at the time. Einhorn, too, exhibited confidence in AAPL and in the third quarter of 2015 upped his stake to 11.7 million shares.

As an activist investor, Icahn called attention to Apple's enormous cash pile, going so far as to float a shareholder proxy vote that would have forced the company to adopt an accelerated stock buyback scheme. Icahn abandoned the initiative Apple bought back $14 billion of its own shares in early 2014.

Greenlight's Einhorn also argued against Apple's cash hoard, saying the practice hurt investors. He sued the company over the issue in 2013, but dropped the action less than a month later.

The hedge fund cuts come ahead of tough quarterly comps for iPhone, Apple's main source of revenue. During the company's most recent quarterly earnings conference call, Apple CEO Tim Cook said he expects iPhone to see its first ever year-over-year decline during the current March quarter. Analysts forecast a return to growth when "iPhone 7" launches this fall.

Comments

  • Reply 1 of 17
    bobschlobbobschlob Posts: 1,074member
    "The hedge fund cuts come ahead of tough quarterly comps for iPhone, Apple's main source of revenue."
     These cuts don't "come ahead" of anything. They 'came ahead' of 'last qtr' (last year, actually), Mikey (Ichan sold a tiny portion of his total AAPL holding at around $107). I would expect these guys have been buying up AAPL at these current levels.
    edited February 2016 zebramatrix077
  • Reply 2 of 17
    The less Icahn, the better!
  • Reply 3 of 17
    Were those two guys jerks? Icahn t tell...
  • Reply 4 of 17
    ac1234ac1234 Posts: 138member
    I think the last two posters have their "anger" aimed in the wrong place.  I am P.O.d that they were among the people pushing Cook to do more buybacks - well over $100,000,000,000 down the drains and the stock continues to suck.  They are shedding AAPL due to a lack of confidence in Timmy and his court of under performers.  A house cleaning is needed starting with the Chair, some useless board members, Timmy, and Eddy - that would be a good start.
  • Reply 5 of 17
    cnocbuicnocbui Posts: 3,613member
    ac1234 said:
    I think the last two posters have their "anger" aimed in the wrong place.  I am P.O.d that they were among the people pushing Cook to do more buybacks - well over $100,000,000,000 down the drains and the stock continues to suck.  They are shedding AAPL due to a lack of confidence in Timmy and his court of under performers.  A house cleaning is needed starting with the Chair, some useless board members, Timmy, and Eddy - that would be a good start.
    Explain in detail how the best performing quarter in the company's history was achieved by under-performers?

    The biggest error Tim Cook has made was to spend more than 2 minutes listening to Icahn and Einhorn - for that he should be criticised.
    palomine
  • Reply 6 of 17
    MacProMacPro Posts: 19,397member
    cnocbui said:
    ac1234 said:
    I think the last two posters have their "anger" aimed in the wrong place.  I am P.O.d that they were among the people pushing Cook to do more buybacks - well over $100,000,000,000 down the drains and the stock continues to suck.  They are shedding AAPL due to a lack of confidence in Timmy and his court of under performers.  A house cleaning is needed starting with the Chair, some useless board members, Timmy, and Eddy - that would be a good start.
    Explain in detail how the best performing quarter in the company's history was achieved by under-performers?

    The biggest error Tim Cook has made was to spend more than 2 minutes listening to Icahn and Einhorn - for that he should be criticised.
    It was pump and dump after all on Icahn's part!  
  • Reply 7 of 17
    MacProMacPro Posts: 19,397member

    ac1234 said:
    I think the last two posters have their "anger" aimed in the wrong place.  I am P.O.d that they were among the people pushing Cook to do more buybacks - well over $100,000,000,000 down the drains and the stock continues to suck.  They are shedding AAPL due to a lack of confidence in Timmy and his court of under performers.  A house cleaning is needed starting with the Chair, some useless board members, Timmy, and Eddy - that would be a good start.
     Forget the stock value for a moment and look at Apple's performance on simply business grounds.  If you had zero access to the Wall Street numbers and had to simply go by the last few years' of Apple's sales and profit data, wouldn't you think Tim and Apple had done a pretty good job?
    edited February 2016 palomine
  • Reply 8 of 17
    tundraboytundraboy Posts: 1,773member
    cnocbui said:
    Explain in detail how the best performing quarter in the company's history was achieved by under-performers?

    The biggest error Tim Cook has made was to spend more than 2 minutes listening to Icahn and Einhorn - for that he should be criticised.
    It was pump and dump after all on Icahn's part!  
    What Icahn says, does, or expels out of his orifices never influenced and will never influence my investment decision on AAPL.
  • Reply 9 of 17
    ac1234ac1234 Posts: 138member
    cnocbui said:
    ac1234 said:
    I think the last two posters have their "anger" aimed in the wrong place.  I am P.O.d that they were among the people pushing Cook to do more buybacks - well over $100,000,000,000 down the drains and the stock continues to suck.  They are shedding AAPL due to a lack of confidence in Timmy and his court of under performers.  A house cleaning is needed starting with the Chair, some useless board members, Timmy, and Eddy - that would be a good start.
    Explain in detail how the best performing quarter in the company's history was achieved by under-performers?

    The biggest error Tim Cook has made was to spend more than 2 minutes listening to Icahn and Einhorn - for that he should be criticised.
    In detail - failure or lack of traction: Home Kit / Health Kit / Video Streaming - Apple TV / for starters.  The lack of innovation is real.  The best performing quarter in history IS based on what was envisioned and operationalized under Steve's era.  Timmy - not so much.  The market is speaking about AAPL in loud terms. 
    edited February 2016
  • Reply 10 of 17
    ac1234ac1234 Posts: 138member

    cnocbui said:
    Explain in detail how the best performing quarter in the company's history was achieved by under-performers?

    The biggest error Tim Cook has made was to spend more than 2 minutes listening to Icahn and Einhorn - for that he should be criticised.
    It was pump and dump after all on Icahn's part!  
    Well, it does not look like the "pump" part worked, did it?  AAPL has been trading at a lower price then it was 3.5 years ago for some time now.  One can not forget the stock price - ROI to investors IS the primary role of the CEO.
    edited February 2016
  • Reply 11 of 17
    ac1234ac1234 Posts: 138member
    Well, adding to my list of continuing low performing results is Apple Pay - this morning's news is that the adoption rate of Apple Pay is under 20% - yet another "yawn" performance.  The new hype is the launch of Apple Pay in China - however, the competition is higher there than what Apple has experienced in the States.




    edited February 2016
  • Reply 12 of 17

    ac1234 said:
    I think the last two posters have their "anger" aimed in the wrong place.  I am P.O.d that they were among the people pushing Cook to do more buybacks - well over $100,000,000,000 down the drains and the stock continues to suck.  They are shedding AAPL due to a lack of confidence in Timmy and his court of under performers.  A house cleaning is needed starting with the Chair, some useless board members, Timmy, and Eddy - that would be a good start.
     Forget the stock value for a moment and look at Apple's performance on simply business grounds.  If you had zero access to the Wall Street numbers and had to simply go by the last few years' of Apple's sales and profit data, wouldn't you think Tim and Apple had done a pretty good job?
    Two years ago the stock was around $76. Five years ago, around $50. So, the message for panic sellers and shorts is: Go long or go home.
  • Reply 13 of 17
    ac1234 said:
    Well, adding to my list of continuing low performing results is Apple Pay - this morning's news is that the adoption rate of Apple Pay is under 20% - yet another "yawn" performance.  The new hype is the launch of Apple Pay in China - however, the competition is higher there than what Apple has experienced in the States.




    Apple Pay is a complex thing to communicate until someone needs to use it. Despite the relative simplicity of the software of the several times that I've used Apple Pay, it was unclear what was supposed to happen. Was I supposed to wait until the cashier told me to do something? How close to the reader was I supposed to hold my phone? Would I be able to change my credit card in the onscreen representation during the process? Was I supposed to find and open the Wallet app first? These things are probably second nature to anyone who uses Apple Pay regularly now, but more than one time something different has happened which has been slightly confusing or annoying and the cashier involved had no answers. I'm guessing the Watch as payment method may be far more intuitive and faster. I think the all digital money economy won't happen this generation (and quite honestly, it will be a dark day for personal privacy when people are eventually forced into using only digital currency controlled by central banking).
    edited February 2016
  • Reply 14 of 17
    ac1234ac1234 Posts: 138member
    Adding to SpamSandwich comments - my chip based credit card is as or more simple to insert in the reader and I don't have to fumble around with my iPhone and likely drop it.  It adds no bulk or weight to use and is fairly secure and federally protected against fraud past the $50 limit.  As such - Apple Pay is not floating my boat.
  • Reply 15 of 17
    ac1234ac1234 Posts: 138member
    Spam - "go long or go home" is understood by many of us who deride the day traders / options traders / short term speculators.  But it is an open market and for every seller / buyer there has to be a buyer / seller to complete the transaction - thus a voluntary transaction on an open market.

    I am waaaaaaaay long - over two decades.  With AAPL now at where it was 3.5 years ago, a troubling trend is at hand.  The criticism I have leveled at Apple and Cook is based on the lack of new product innovation under Cook's tenure as CEO.  My operations are chock full of Apple products - Mac Pro / multiple 27" iMacs / MBPs / iPads / iPhones / and several useless Apple TVs.  The current financial performance we are seeing under Cook is under pinned by the products developed under Steve's tenure.

    Tim's stuff is not moving the needle - I just don't think he has it in him.  Add to that the $100,000,000,000 + waste on buybacks and long term shareholders are seeing a large drop in their AAPL ROI.

    How long is long term thinking?  For a day trader it may be 5 minutes.  For a sage Chinese philosopher it is more like 1,000 years.  For many of us 3+ years is getting long.
    edited February 2016
  • Reply 16 of 17
    ac1234 said:
    Spam - "go long or go home" is understood by many of us who deride the day traders / options traders / short term speculators.  But it is an open market and for every seller / buyer there has to be a buyer / seller to complete the transaction - thus a voluntary transaction on an open market.

    I am waaaaaaaay long - over two decades.  With AAPL now at where it was 3.5 years ago, a troubling trend is at hand.  The criticism I have leveled at Apple and Cook is based on the lack of new product innovation under Cook's tenure as CEO.  My operations are chock full of Apple products - Mac Pro / multiple 27" iMacs / MBPs / iPads / iPhones / and several useless Apple TVs.  The current financial performance we are seeing under Cook is under pinned by the products developed under Steve's tenure.

    Tim's stuff is not moving the needle - I just don't think he has it in him.  Add to that the $100,000,000,000 + waste on buybacks and long term shareholders are seeing a large drop in their AAPL ROI.

    How long is long term thinking?  For a day trader it may be 5 minutes.  For a sage Chinese philosopher it is more like 1,000 years.  For many of us 3+ years is getting long.
    People are certainly free to trade in and out of the stock as often as they want and should not be influenced by my statements or yours (or anyone else's, for that matter). I don't advise people how they should trade or hold their stocks, that's a very personal decision.
    edited February 2016
  • Reply 17 of 17
    Of course - those decisions are ultimately made by the individuals.  The gist of my posts is to point out that the current financial success of Apple is based on game changing products from Steve's era.  I agree that Tim has enhanced those offerings but the market is displaying a lack of confidence about the future.  If Tim could have corrected it I think he would have done so by now.  So......
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