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  • Icahn Claims Apple Stock is Still Highly Undervalued, Plans to Up His $203 Price Target


    The infamous activist investor, Carl Icahn, currently still believes that Apple shares should be valued much higher than their current trading price. According to him, he plans to revise his own price target for the stock which he claims is a “no-brainer” investment. The billionaire appeared on CNBC where he and his team were very pleased with Apple’s impressive quarterly results. For those of you who didn’t know, Icahn has a reputation for using his considerable wealth to interfere with publicly traded companies – a move which he seems to be making towards Apple and its continued success.

    Icahn had the following to say regarding the matter:

    I don't recommend too many stocks, I don't like to do that unless I think it's a no-brainer. And this one is sort of amazing to me, because you know every decade you get one of these — maybe two or three.
    He claims that investors on Wall Street haven’t “understood” Apple for about a year and a half. Some of you might remember that Icahn issued a note to Apple CEO Tim Cook encouraging him to buy back more shares and at the time said his own models suggest the company should be trading at around $203. Given that Apple broke records once again this week, Icahn said that he’ll have to rethink that price target suggesting it could go even higher. He had the following to say regarding the matter:

    I guess we're going to have to revise our guidance.
    Icahn and his team believe that Apple should spend more of its cash hoard on its own shares, particularly when he thinks they are significantly undervalued. As of the end of the first quarter of fiscal 2015, Apple had $179 billion in cash.

    Previously, he called Apple’s cash position an “excessive liquidity,” which he believes should push the company to adopt a “more aggressive pace” when it comes to buying back its own shares. That being said, Icahn and Apple are far less contentious than in late 2013 when Icahn attempted to file a shareholder proxy vote to push Apple to repurchase more of its own shares. He eventually ended up dropping the initiative when Apple bought roughly $14 billion worth of its own shares in a matter of weeks in early 2014.

    We’ll have to see what Apple ends up doing and what Icahn values the AAPL stock at after he and his team revise their price target.

    Source: CNBC via AppleInsider
    This article was originally published in forum thread: Icahn Claims Apple Stock is Still Highly Undervalued, Plans to Up His $203 Price Target started by Akshay Masand View original post