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Why is there so much negativity here on this board? I applaud every time when he buys Apple shares. Apple is not one of the smaller companies that he could manipulate. Even if he had $5b invested in Apple, it's still just 1%.

Apple will be just fine, regardless if the managements choose to buyback more shares or not. Just relax. He won't be able to 'destroy' Apple even if he tries to.

That's why Icahn wants a buy-back. Every buy-back increases his share of the company and ability to influence the board without spending his own money. Icahn wants less shares on the market so his share represents a greater percentage of outstanding shares and he can therefore sway shareholder votes more. The more he can do this then he will be able to build up steam to further increase his influence. Icahn recognizes that Apple is a money-printing machine. He is making a play to control that machine and line his own pockets.
 
Neither, or both. Nobody holds stock forever. They buy with the expectation that some day they will cash out, though not necessarily all at once. Icahn isn't telling Apple anything that they don't know already. The cash hoard is dead money.


Thanks, appreciate the info.
 
Not to mention a little airline called TWA...


For context, he owned 40% of TWA. He now owns slightly less than 1% of AAPL and if he put every cent he has into AAPL he'd still only own around 5% of the company.

And while his presence should be taken seriously he doesn't stand a chance of having the control over AAPL that he has had over other companies.
 
Man this guy is irritating!
Billions of Dollars... Completely Selfish Motives... On Social Media no less...

Carl:- I have $3 Billion dollars of Apple Shares People! :D
Carl:- @Apple you should buy this back from me for $4 Billion.

So irritating... :mad:

This kind of Market making should be illegal.
 
I think #2 is his bigger motivator. He doesn't have enough money to get a significant voice in Apple share holder meetings like he has done in the past with Dell or TWA. BUT, if he can get Apple to use its own cash to buy back shares then they are increasing his percentage share of the company's total stock and therefore his ability to influence the board by voting his shares.

I was with you right up to this point. The immediate result of the buyback is an increase in relative stock price. Since I believe Icahn is in it for the money, and since the influence coming along with 2% of a company's stock is negligible, especially when compared to 1.5%, I'm going to go with the money.
 
Man this guy is irritating!
Billions of Dollars... Completely Selfish Motives... On Social Media no less...

Carl:- I have $3 Billion dollars of Apple Shares People! :D
Carl:- @Apple you should buy this back from me for $4 Billion.

So irritating... :mad:

This kind of Market making should be illegal.

I don't think Carl is asking Apple to buy back his own shares. He wants Apple to buy back other people's shares and retire them. When that happens the price of his shares will go up, but more importantly his percentage of outstanding shares at Apple will also go up. This increase in percentage translates into direct influence on the board by voting that higher percentage of shares at shareholder meetings. AAPL costs too much for Carl to gain a huge influence on shareholder vote, so why not ask Apple to spend its own cash reserves to increase his voting influence?

----------

I was with you right up to this point. The immediate result of the buyback is an increase in relative stock price. Since I believe Icahn is in it for the money, and since the influence coming along with 2% of a company's stock is negligible, especially when compared to 1.5%, I'm going to go with the money.

Yeah, but originally Icahn was asking Apple to buy back $150B of stock "immediately". When he was asking this, the market cap was $400 to $450B. Icahn was asking Apple to increase his percentage share by 50%. I think Icahn is making a longer term play. I think he wants to be on the board. He can see that Apple is essentially printing $40B per year and could be printing $60B per year in five years.
 
Yeah, but originally Icahn was asking Apple to buy back $150B of stock "immediately". When he was asking this, the market cap was $400 to $450B. Icahn was asking Apple to increase his percentage share by 50%. I think Icahn is making a longer term play. I think he wants to be on the board. He can see that Apple is essentially printing $40B per year and could be printing $60B per year in five years.

From negligible to slightly more than negligible still gets you no control. I won't pretend to be a mind reader, but I don't see where Icahn could hold out any hope of becoming a board member. He has only been able to pull his power plays at ailing companies. Apple certainly isn't one of those, so I just don't see it happening here. In fact if he is successful in pushing up the stock price, the cost of a power play increases proportionally.
 
Let's see ... do I want to agree with the billionaire or everyone here on the forum?

I think I agree with the billionaire and want the stock price to rise. I think that AAPL should buy back their own stock. Especially that they know what products are on the roadmap, this just tells me that AAPL doesn't think the value of the company will rise anymore. If you knew your company was undervalued and had tons of money wouldn't you buy more of your own stock?
 
Let's see ... do I want to agree with the billionaire or everyone here on the forum?

I think I agree with the billionaire and want the stock price to rise. I think that AAPL should buy back their own stock. Especially that they know what products are on the roadmap, this just tells me that AAPL doesn't think the value of the company will rise anymore. If you knew your company was undervalued and had tons of money wouldn't you buy more of your own stock?

Apple is currently executing "the largest single share repurchase authorization in history". Link
 
What's Mrs. Jobs (forget her first name) % ownership?

There's the danger of Icahn owning a controlling % of Apple.

He may own a large dollar amount of the stock, but it's still small compared to the total amount of shares. $3B / $500B market cap = 0.6% ownership.
 
Don't worry, about 98% of the comments in these threads come from people who don't know a thing about the markets.

When you buy shares in a public company, you are buying a piece of that company's earnings. Buybacks concentrate earnings on fewer shares. If a company with 100M shares earned $100M, the earnings per share (EPS) is $1.00. If they take 50M shares off the market through a buyback, EPS will rise to $2.00. If companies do nothing about the number of shares outstanding, over time the opposite will happen, as they grant shares and stock options to executives. This is called dilution. In part, buybacks are a strategy to reverse dilution.

So just to be clear about a couple of things: First, Apple is under no "pressure" do anything, so the headline of this article is fundamentally misleading. Second, the buyback that Icahn is proposing represents less than the amount of free cash Apple will generate in one year. So even if Apple accepted the proposal, they'd still end up the year with more than the $150B cash hoard that they are sitting on today.

Finally, Icahn is fundamentally correct. When a company generates cash far in excess of their ability to reinvest it in growing the company, then they need to find other ways to benefit stockholders. The two ways are dividends and buybacks. Apple is already doing both, so the only question is whether either or both will be increased. Last I heard from Apple, they were preparing to announcing something this month. It might come next week, at the earnings announcement.

Great summary. Agree with everything. I would only add that as the company buys back stock, those that still own stock increase their stake in the company. So as he buys more stock and the company does buyback he is actually gets an extra increase in the company stake. And as EPS increase due to the reduced number of shares, he wins again. Essentially, the strategy works really well for him, and for any other major shareholder. The value of this strategy for the rest is questionable -- especially as the power gets concentrated in to fewer shareholder that lack vision for the company beyond their personal gain.
 
I don't think he will be able to "destroy" Apple even if he wanted to, but history has shown he's not an "investor". In the past, he has bought enough shares and thus influence to cause problems for management. Then management, in essence, buys him out at a premium and hurting the company. Sometimes the ideas are good, but management wants to be in control, so we (Apple fans) lose on both counts.

Why is there so much negativity here on this board? I applaud every time when he buys Apple shares. Apple is not one of the smaller companies that he could manipulate. Even if he had $5b invested in Apple, it's still just 1%.

Apple will be just fine, regardless if the managements choose to buyback more shares or not. Just relax. He won't be able to 'destroy' Apple even if he tries to.
 
What's Mrs. Jobs (forget her first name) % ownership?

There's the danger of Icahn owning a controlling % of Apple.

I don't know how much the Jobs family owns. I was under the impression that Steve sold most of his stock after leaving and didn't accumulate a large percentage after coming back.

I don't think there's any present danger of Icahn obtaining controlling interest in Apple. Controlling interest isn't just whoever owns the highest percentage, it has to be so much that all the rest of the stockholders combined can't outvote them.
 
Lol, when I was skimming the article headline I almost missed the word billion.

"...Passes $3 Amid Continued Stock Buyback Pressure!"

:p
 
Most people on the forum are hard core apple fans, and don't really have a full education on how the market works. Its very irresponsible for apple to do nothing with their money. Money sitting unused is profit lost. And you have to remember that shareholdes OWN apple, they aren't just a bunch of crooks trying to leech. They were there to make apple rich when they sold off shares at the IPO, floated apple in the 90s when they needed to raise cash, and now Icahn wants apple to do something with that cash - buy some companies, give it to shareholders -SOMETHING. He specifically wants apple to buy back more of itself, which both increases the share price and gives Apple more control moving forward.

And I do too. Its what a good company needs to do.

They've got over 120 BILLION dollars doing NOTHING.


I don't love Icahn and I really do wish he'd leave apple alone - but let's stop badgering him like he wants to dismantle the company.


It's also very irresponsible to assume that AAPL is doing nothing with its money, and that either Icahn or you know better than AAPL's BOD and exec team how to utilize its assets. It's a marathon, not a sprint.
 
2) Given the price of AAPL, it is the only way he can gain significant voting strength at shareholder meetings. The more shares that Apple retires, the greater percentage of the company Icahn owns and therefore he gets more say when he votes with his shares.

I think #2 is his bigger motivator. He doesn't have enough money to get a significant voice in Apple share holder meetings like he has done in the past with Dell or TWA. BUT, if he can get Apple to use its own cash to buy back shares then they are increasing his percentage share of the company's total stock and therefore his ability to influence the board by voting his shares.

Which is what scares me.
 
Great summary. Agree with everything. I would only add that as the company buys back stock, those that still own stock increase their stake in the company. So as he buys more stock and the company does buyback he is actually gets an extra increase in the company stake. And as EPS increase due to the reduced number of shares, he wins again. Essentially, the strategy works really well for him, and for any other major shareholder. The value of this strategy for the rest is questionable -- especially as the power gets concentrated in to fewer shareholder that lack vision for the company beyond their personal gain.

Not really. No one is forced to sell, and with @900M shares outstanding, over-concentration not a concern, not that I necessarily favor a buyback beyond that presently underway.
 
Finally, Icahn is fundamentally correct. When a company generates cash far in excess of their ability to reinvest it in growing the company, then they need to find other ways to benefit stockholders. The two ways are dividends and buybacks. Apple is already doing both, so the only question is whether either or both will be increased.

Nice summary. I would also add that there's a third way to increase shareholder value and that's through acquisitions. Apple could buy Yahoo, for example.
 
Didn't AAPL already do a buyback and didn't they have to borrow in order to do it and avoid massive taxes?
 
I wouldn't...

...cave into this guy. Apple has been successful without his influence and will continue to be. As for what Apple is doing at this moment is particularly important. Mac Pro being manufactured in the US, sapphire crystal for iPhones, iPads, iPods (and whatever else) being manufactured in the US. These are important things if companies like Apple are going to produce their wares in the US as the cash stock pile will fund all of these endeavours. Long term goal should be to slowly remove dependence on companies where labor laws are lax and there is no effective way to monitor the practices of your partners. These had a negative affect on a company like Apple which seems to have a higher moral code (I said seems, as there's no way I know for certain without seeing for myself).

So while one may not appreciate the way the cash is being used, I'm certain that we will see more of it being used in this way and not just on acquisitions.

Market value is all and well, but bringing life changes to your home nation and providing jobs and security I would say is far greater reward.

Hey what do I know. :)
 
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