Not really. Splits lower prices proportionately and REVERSE splits raise prices proportionately. And, your car example makes no sense. If shares in the car are bought back, value leaves to buy back those shares. With a fixed value asset (inflation aside), there is no change in value of the remaining shares. In an enterprise such as AAPL, reducing shares through a buyback increases the value of the remaining shares IF the shares can be bought back for less than the present value of future eps.
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Investor Carl Icahn to Have Dinner With Tim Cook, 'Magnitude' of Share Buyback to Be Discussed
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Not really. Splits lower prices proportionately and REVERSE splits raise prices proportionately. And, your car example makes no sense. If shares in the car are bought back, value leaves to buy back those shares. With a fixed value asset (inflation aside), there is no change in value of the remaining shares. In an enterprise such as AAPL, reducing shares through a buyback increases the value of the remaining shares IF the shares can be bought back for less than the present value of future eps.
The optics of it are definitely not good. Only a fool will think they're going to talk about the weather. Icahn is going to try to convince Tim, to do what's good for Icahn, plain and simple. Grand scale manipulation, at its finest.
You might as well just shout out that you haven't read the thread and don't know anything about how the market works.
This is getting tiresome. Willful ignorance is truly contemptible.
The magnitude of stock buybacks before it happens could be considered inside info.
It's ok. I understand what is going on, even if you think I don't.
Sorry but it's not at all flawed.
No board member/employee is allowed to trade on information they have that the general public does not. If it's shown there is a correlation, they are fined or worst. They can hold all the stock they want. If they sell and a few days later information comes out that tanks the stock, those individuals will be looked at for insider trading. If they bought and information comes out that rockets the stock, they can also be fined or worst. That's why most companies have either a lockdown on when you can sell/buy or pre set sell dates or buy dates. That way whatever the stock price is it is if you want to buy or sell.
You might want to look up insider trading and the definition of it. People get fined or worse all the time on it. ImClone is the perfect example.
You can't trade on information or results you have that others don't. That's ILLEGAL.
That's the danger of owning stock in a company you work for.
Tim Cook can have dinner with whoever he wants. He just can't discuss information that is not public about Apple or not reveal the details of the meeting if it's something the other person can trade on...especially some like the magnitude say a buyback.
Not the same thing. Tim can do whatever he wants. The point is Ichan is having dinner with him to discuss information that right now is not public. If they have any discussion about the direction Apple is going and the buyback then that information must be made public by Tim.
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Im not saying i understand economics, but isn't this guy pretty saying "i've bought a shed load of shares, now get this shareholders buyback scheme running, and make it a lot for me to make a fast profit".
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Please tell all of us idiots how it works then, because to me thats whats Icahn is doing.
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Please tell all of us idiots how it works then, because to me thats whats Icahn is doing.
Please read through this thread. It's not too long so it's not unreasonable. This "news" is completely unremarkable and people are making a huge deal about a non-event. It is legitimately laughable.
I had indeed read the thread in it's entirety, as well as read up on Icahn's background. This man has a record of attempting to acquire, break up, and/or sell off various parts of a company, to further his individual goals. There's nothing defensible about that.
He has attempted, and in some cases effected, several hostile take-overs, and has a reputation as a ruthless "corporate raider". His hostile take-over of TWA ultimately resulted in it's demise, after he had stripped it of all it's assets. He's tried to break up US Steel, and tried to break up Time Warner into four separate divisions. He tried to take over Mentor Graphics, forcing it to sign a poison pill provision.
He tried to take over Yahoo, is currently attempting to take over Dell, and since 2007, has steadily increased his stake in Biogen, seeking to possibly acquire, break up, and/or sell off various parts of that company; he has so far managed to get two of his allies on it's board with the apparent goal of splitting the company into two, and hopefully replacing CEO Mullen, with whom he does not see eye-to-eye. And this is just only a small sample of Icahn's business dealings.
If you believe those of us so suspicious of this man's motives are so wildly off the mark with our judgement, then please enlighten us; maybe, we are wrong.
This guy is just a parasite, he is trying to get Apple to change its policies so he can make a quick profit. He has no interest in the long term future of the company or the brand, Tim Cook should just sit there throughout dinner smiling and nodding his head and then totally ignore anything this guy says.
In this case, he's bought @1/4 of 1%. It's enough to get him a seat at a dinner to be heard, but certainly not on any board, or any clout on policy for that matter. It won't get him any nonpublic info either. Yes, his motives are self serving. He sees a greatly undervalued stock and believes that a far larger buyback now, while it's cheap, will benefit shareholders. His involvement may also benefit AAPL, and shareholders in general, by all the publicity he's getting--showing that a heavyweight believes in the company and stock. This counters the constant negative chatter from bloggers, cnbs talking heads and "analcysts", not to mention Samsung's huge advertising budget and 8+ agencies employed in direct and viral campaigns.
Smiling and nodding sounds good. However, I hope/expect he would only ignore ideas he/AAPL disagrees with, not "anything this guy says." Icahn is not going to learn anything that isn't already public about AAPL, but TC will have the opportunity to get some valuable information and insights from a major player about hedge funds and how they play/have been playing AAPL.
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I know that you believe you understand what you think I said, but Im not sure you realize that what you heard is not what I meant.
Oh look, more ignorance. Again, it's easy to throw accusations when you don't know what you're talking about.
itguy06 said:
You know, except for the long-term positive return expectation.
macs4nw said:
Oh no! Someone's trying to make money! You don't seem to understand that breaking up or selling off various parts of a company is often in the best interests of everyone except management who are intent on empire-building and creating unfocused conglomerates.
Uh, ok.
http://www.stlmag.com/St-Louis-Magazine/October-2005/TWA-Death-Of-A-Legend/
Please read.
How is this bad? A company split into separate divisions?! The horror!
This is getting funny at this point.
You mean from Jerry Yang, the egomaniac founder who pushed for Yahoo to not accept a bid from MSFT at approximately 65% above market? The bid that, even after this multi-year bull market, is still over 12% higher than YHOO's current price? The bid that would have paid Yahoo shareholders years ago and given them the funds to invest in other equities (maybe you haven't tracked the market's performance in the past couple years)?
Wait, do you mean his involvement in exposing a monetarily deficient going-private deal that was going to be rubber-stamped by the subservient Board of Directors at the expense of the common shareholder and ultimately getting a better price for all shareholders?
And yet you still seem to think any attempt to change the status quo is somehow bad for everyone except Icahn.
I won't be spending more time on people who clearly don't want to hear anything that doesn't fit their narrative.
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just what blackberry is doing to save their sinking ship
...... all apple needs to do is listen to the demands of consumers and then make a "perfect phone".
...... all apple needs to do is listen to the demands of consumers and then make a "perfect phone".
Certainly you sensed my sarcasm.
How do you know that? How do you know they're going to talk about information that is not public? If you have Insider information on what is to be discussed at this dinner, then by all means pick up the phone and call the SEC. But if all Icahn does is lay it on the table how much of a buyback Apple should engage in and the reasons why, and Tim Cook thanks him for his opinion and that he will bring it up with the board, that's not insider information. You can put on your tinfoil hat and scream it from the rooftops but it doesn't make it true.
I agree, but you're assuming Icahn or cook are trading on the information.
An investor (Icahn) having inside information is not against federal law in any way, shape, or form in the United States. However, the second anyone (investor or not) gets inside information they are considered an insider and are thus subject to insider trading laws (not just employees or board members, as you stated above). Trading on that information, or attempting to manipulate the markets, is quite illegal. Thus a dinner, even if they discuss inside info, is not illegal so long as neither party trades based on it.
While cook in that instance could be considered a tipper, no laws would have been violated. Is it dirty as heck? Sure. It is shady. But it is not illegal so long as neither party trades on it or attempts to manipulate the market with the info.
To further clarify - lets say you work for Samsung and hold a few shares of Apple and find out they just made a huge order for chips for the next unreleased iDevice. If you trade on that information, you are breaking the law. It isn't illegal for you to be an investor or to know they made an order - you just cant trade on it.
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Only if they were to make an agreement as to the size of the buyback and then only if Icahn traded on that info before it was made public.
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Wow! Really? Do you deal in hyperbole often? Certainly you can think of one example of a speculator or speculators not being completely useless.
For example, let's say you had $100,000 you were looking to invest. Someone came to you with what you thought to be a brilliant idea and they just needed some start up cash to get it going. You give them the money, they produce their product and are wildly successful. You cash out making a handsome profit and the company goes on to be a multi-billionaire dollar conglomerate employing thousands upon thousands of people. Still think speculators are "the most useless people on Earth"? Even if greed is their primary focus in speculating, certainly they are of some value.
What about all the little ol' ladies with their CD's, IRA's or other income producing retirement vehicles? Aren't they just useless speculators too?
/rant
The remains of Steve Jobs has commenced axial rotation.
. . . . . . and yes, how is Carl Icahn (this waste of human flesh) not in prison for insider trading?