Citing concerns in China, activist investor Carl Icahn no longer owns shares of Apple
Billionaire Carl Icahn, who has used his financial clout to influence boardroom decisions at publicly traded companies, announced on Thursday that he no longer owns shares in Apple, just days after the company announced its first revenue decline in over a decade.
Appearing on CNBC, Icahn revealed that he is no longer an investor in AAPL. The activist investor was previously bullish on the iPhone maker, having shared his own price target of $240 per share a year ago.
Despite the bold prediction, shares of Apple haven't come anywhere close to that target, which would value the company at $1.4 trillion. Shares of the company have traded under $100 this week, following a March quarter that disappointed Wall Street.
With the first-ever year-over-year decline in iPhone sales, Apple's revenue fell from $58.01 billion in 2015 to $50.6 billion in 2016. Sales in China were off 26 percent.
Icahn said he still views Apple as a "great company," but said concerns over the Chinese economy and its government led him to sell off his shares. He expressed concern that the Chinese government could "come in and make it very difficult for Apple to sell there."
After the announcement, shares of AAPL slid even further in Thursday afternoon trading.
Icahn had already cut his position in AAPL in late 2015, shedding 7 million shares. But at the time he still owned a massive 45.8 million shares in the company.
Back in 2013, Icahn and Apple had a contentious relationship, during which the billionaire attempted to file a shareholder proxy vote to push Apple to repurchase more of its own shares. Icahn eventually dropped that initiative after Apple bought some $14 billion worth of its own shares in a matter of weeks in early 2014.
This week, Apple announced it will add $50 billion to its capital return program, and also increase its quarterly dividend by 10 percent. But that apparently wasn't enough for Icahn to stay invested in the company.
Appearing on CNBC, Icahn revealed that he is no longer an investor in AAPL. The activist investor was previously bullish on the iPhone maker, having shared his own price target of $240 per share a year ago.
Carl Icahn said he still views Apple as a "great company" and that CEO Tim Cook is doing a good job, but he's concerned about interference from the Chinese government.
Despite the bold prediction, shares of Apple haven't come anywhere close to that target, which would value the company at $1.4 trillion. Shares of the company have traded under $100 this week, following a March quarter that disappointed Wall Street.
With the first-ever year-over-year decline in iPhone sales, Apple's revenue fell from $58.01 billion in 2015 to $50.6 billion in 2016. Sales in China were off 26 percent.
Icahn said he still views Apple as a "great company," but said concerns over the Chinese economy and its government led him to sell off his shares. He expressed concern that the Chinese government could "come in and make it very difficult for Apple to sell there."
After the announcement, shares of AAPL slid even further in Thursday afternoon trading.
Icahn had already cut his position in AAPL in late 2015, shedding 7 million shares. But at the time he still owned a massive 45.8 million shares in the company.
Back in 2013, Icahn and Apple had a contentious relationship, during which the billionaire attempted to file a shareholder proxy vote to push Apple to repurchase more of its own shares. Icahn eventually dropped that initiative after Apple bought some $14 billion worth of its own shares in a matter of weeks in early 2014.
This week, Apple announced it will add $50 billion to its capital return program, and also increase its quarterly dividend by 10 percent. But that apparently wasn't enough for Icahn to stay invested in the company.
Comments
If Apple continues the buyback, they should be buying it all back now when it's undervalued.
Tim Cook is NOT the problem Wall Street is. Their illegal activities are being overlooked and they're getting away with it. Luckily Apple is so huge that the stock markets can't actually do anything to the company and is more of a boil on the butt of Apple. Hopefully one day it will be lanced and Apple can get on to some real work without distractions. THEN you'll see what Apple can really do.
No, Apple's Board of Directors authorized the buyback, just like they authorize dividend payouts. Tim Cook alone cannot spend the company's money on stock buybacks. From the earnings call transcript, I give you Luca Maestri:
Once again, we are allocating the majority of the expansion of the program to share repurchases, given our strong confidence in Apple's future, and the value we see in our stock. The Board has increased the share repurchase authorization by $35 billion, raising it from the current $140 billion level to $175 billion. We will also continue to net share settle, less the employee restricted stock units.
imo Apple price reflects its sales performance, I don't think there is any kind of meaningful conspiracy at play here. That being said, I am not really impress with innovation coming out of Apple in the last 2 years. Products are still very good, but they should be doing better.