The legendary investor Carl Icahn recently disclosed on Twitter that his holding company has taken a “larger position” in Apple. He shared his belief that Apple is “extremely undervalued” and should increase its share buyback program. This advice is very similar to that of Warren Buffet earlier this year, though Buffet didn’t take a position in Apple. The news was disclosed after he warned investors that he may disclose material information on his Twitter account in accordance with new SEC guidelines on social media use.
For those of you who don’t know Icahn has an estimated net worth of $20 billion and has recently been extensively involved in efforts to keep Dell from going private. He even holds a 16% stake in Nuance, the speech recognition company that Apple uses for Siri. According to the folks over at Bloomberg, Icahn has taken a position of at least $1 billion in Apple and is projected the stock to rise to a value over $600. As a result, Apple issued the following statement:
We appreciate the interest and investment of all our shareholders. Tim had a very positive conversation with Mr. Icahn today.
This is a no brainer to go buy stock in a company that can go borrow" at a low rate, Mr. Icahn said. "Buy the company here and even without earnings growth, we think it ought to be worth $625.
Source: Bloomberg (Twitter), Carl Icahn (Twitter), The Wall Street Journal