Carl Icahn Asks for Accelerated Stock Repurchase Program in Letter to Apple's Tim Cook

[macs4nw]

Can't stand this guy. He's a microcosm for everything cancerous about Western civilisation.

Many of us echo your sentiments.

To be sure, as human beings, we are all inherently greedy, but to have that greed so prominently on display such as seen in many stock market transactions, is repugnant and repulsive to many ordinary (read: not actively involved in the stock market) people.

Unfortunately, as pointed out numerous times, being a publicly-owned company, Apple can not (and should not) completely ignore their shareholders, and with 53 million shares, Icahn (or is that iCan perhaps), as repugnant as he may appear sometimes, definitely wields some clout in influencing Apple's management or disposal of those huge, but mostly foreign held, cash piles.

At this moment it would be suicide for them to do so, but it should be pointed out once more that collectively, shareholders do have the power to remove CEO's they don't deem to act in their best interest.

 

[UpperQuadrant]

Many of us echo your sentiments.

To be sure, as human beings, we are all inherently greedy, but to have that greed so prominently on display such as seen in many stock market transactions, is repugnant and repulsive to many ordinary (read: not actively involved in the stock market) people.

Unfortunately, as pointed out numerous times, being a publicly-owned company, Apple can not (and should not) completely ignore their shareholders, and with 53 million shares, Icahn (or is that iCan perhaps), as repugnant as he may appear sometimes, definitely wields some clout in influencing Apple's management of those huge, but mostly foreign held, cash piles.

At this moment it would be suicide for them to do so, but it should be pointed out once more that collectively, shareholders do have the power to remove CEO's they don't deem to act in their best interest.

Icahn wants to throw his weight around since he has Billions of dollars worth of Apple Stock and he wants to double his money at Apple's expense. He has a disease that some investors have, you buy some stock in the company and you want to make as much money on it as possible even if the company takes out a loan or issues bonds to help pay to increase the stock value so you can dump it after you doubled your money in a short period of time.

I think Apple needs to figure out how to bring the money in from Ireland and to quit screwing around with racking up more debt to pay dividends and buying back shares.

Maybe someday they'll need the money to make a major acquisition like an Oracle, IBM or some major corporation like that. I think it would be funny as heck if Apple bought either one of these companies. Apple does need to do something to get into the Enterprise market with more penetration and I think that would certainly help.

 

[GfPQqmcRKUvP]

Yeah, I'm a finance executive and don't understand finance. Hmmm...

Your problem, and IJ's too, is that you've have been indoctrinated to take a quantitative-only approach, so that all you see are the ratios, formulae, and sums, that's the only theoretical underpinnings your view of the discussion has. Heretic Jon and I obviously share extremely similar viewpoints on this. There is a whole qualitative side to the world of business and finance that you are either completely blind and oblivious to, or are purposely ignoring to justify your position to yourself.

No, you literally have it wrong. I am more than happy for people to disagree with me on my conclusions but we are not entitled to our own facts. As I've stated before you simply don't understand the topic well enough to lead to an opinion that means anything.

I've been posting about both qualitative and quantitative factors the whole time. I know this doesn't fit into your little dichotomy you're trying to perpetuate but read my past posts. I've used very few numbers to justify my position.

Finance executive? I'm not exaggerating here: you would be quite literally laughed out of any meeting that deals with actual finance (think buy-side shop or ibank).

 

[MyopicPaideia]

No, you literally have it wrong. I am more than happy for people to disagree with me on my conclusions but we are not entitled to our own facts. As I've stated before you simply don't understand the topic well enough to lead to an opinion that means anything.

I've been posting about both qualitative and quantitative factors the whole time. I know this doesn't fit into your little dichotomy you're trying to perpetuate but read my past posts. I've used very few numbers to justify my position.

Finance executive? I'm not exaggerating here: you would be quite literally laughed out of any meeting that deals with actual finance (think buy-side shop or ibank).

List a few of the qualitative arguments you've been making.

 

[Jon the Heretic]

Exactly

Actually, what should be maximized is stakeholder value : employees, shareholders, customers, community, country, world. If you run a function that improved all those long term, you'd get one hell of a good place to live in and people would still make plenty of money. Of course, nobody would get the maximum money they could get if they screwed somebody else...

Right now firms are maximized for C level execs, highly sought professionals and some large shareholders' profits and little else. Everybody loses but the few and no, their money is not trickling down to the masses below! (GOP mantra for 35 years)

Exactly. Companies that are run correctly benefit everyone: execs, shareholders, employees and especially customers. I am sure Costco must be reviled by the HBS ilk because they sell excellent products for a good price and against all reason (or is it?) they treat their employees well. They even cap profits because it is a signal they could be lowering prices and passing that savings along to customers.

Costco execs aren't being humanitarians; they are realizing shareholder value by 1) selling products people want to buy; 2) selling at a price appealing to consumers; 3) instilling customer loyalty by not price gouging or exploiting customers; customers keep coming back! 4) treating employees well, and they in respond by treating customers much better than Walmart's army of zombies. They have a stake in the company doing well and it shows. What the hell is wrong with them!?

Like most companies today, Apple is hardly run by saints and they like most tech companies partake in the exploitation of third world markets, too. Today it is hard to find an exception to this. But it is not a differentiator. What Apple does brilliantly is make great products that people want to buy, create brand loyalty that is based on something real, not just advertising like some nimrods assert. Apple's design sense comes from world class designers and user researches who are trying to create the best user experience for their customers. That means spending money on (gasp and holy crap!) competitive salaries! And that makes Apple a stand out. They spend R&D to make things BETTER, which in turn translates to better sales. In this respect, Apple also flies in the face of the business zeitgeist, which is content to spend as little as possible -- and less if possible -- to extract money from consumers.

But Apple and Costco I have no doubt could extract way more money than they do now if they simply thought solely in terms of the next quarter. Dr. Evil's advice to Costco -- cut pensions, healthcare, hire illegal workers and college kids after laying off current staff; Apple, get rid of R&D--too expensive; use stock buybacks to inflate your stock performance -- use the money stolen from employees, it's like FREE money and the execs get that cha-ching feeling without having to earn it; adopt Android as core OS and stop writing your own OS; for Costco, stop selling quality items with at most a 15% profit -- substitute lower quality items THAT LOOK ALMOST the same and shoot for 50% markup; more pretend sales; sell once great brands that now make only crap and switch to different brands when customers start to notice.

See how easy it is to become a C level exec once you've lost your soul and stop even caring about whether your company will be around a year from now?

 

[spyguy10709]

Not sure what set you off nor do I really care, but I am all for helping lost souls...

FB, Dell and MS didn't run themselves by the Harvard Business School (HBS) "shareholder returns is all that matters" model when those "low level employees" (mail room people? wow!!) became "millionaires". Those companies were driven by innovation and growth.

Today, things are quite different. Dell went PRIVATE. Why is that? Didn't they like shareholder value is all that matters? Shareholders would be all for 'sell the pieces and get out of that low commodity market'. Instead, they went private. Microsoft today is embracing the HBS model, like IBM, like HP and other companies that are seriously screwing themselves. They lack much of the influence they used to have and are much less influential in the very categories they used to dominate.

The HBS model is an absolutely terrible way to run a company. It mandates that you care only about the Quarter; long term growth and vision are often completely forgotten. Under the HBS model, MS today is not NOT minting millionaires out of mail room guys, nor is IBM or HP. The ONLY people making out are higher level execs, because their compensation is tied to this shareholder value nonsense. They are employees who receive huge chunks of the company (shares), become instant 'owners' and use it to get ahead and inevitably at the expense of the long term prospects of the company and their workers.

It is how the world works? Awesome. So is slavery, child labor, murder, theft, mutilation, rape, disease, stupidity, and so on. Should we embrace evil and call it good because 'that is how the world works'? You may if you like but then you become part of the problem.

Financial Engineering is what companies do when they fail to innovate any longer. It wasn't always like this. Once upon a time, MS and HP were able to innovate. Now, they buy back shares and look to the next quarter to see who they can lay off next. I'd rather live in a world where companies engineer great products, not engineer 'profits'.

lol