This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Carl Icahn Is Short Sighted on Apple (Update 2)

Given Icahn's stake in the company, (Icahn didn't reveal the size of his stake on Twitter, but it's been reported to be worth at least $1 billion, and perhaps more than $1.5 billion), he likely doesn't have the clout to advocate further change for an expanded buyback.

Icahn has pushed for change at other tech companies, and is currently locked in a battle over the fate of Dell (DELL). Apple however is a different beast, considering it's the largest company in the S&P 500 and far bigger than anything he's gone up against before.

UBS analyst Steve Milunovich who rates Apple "buy" with a $500 price target, believes Icahn may be unsuccessful in his attempts. "We think that unlikely with Apple already repurchasing about 5% of shares annually and offering a 2.5% dividend yield," Milunovich wrote in his note. "There doesn't appear to be much to agitate for aside from a larger buyback unless Icahn thinks Cook isn't doing a good job."

Apple doesn't need distractions from Icahn or other activist investors right now. Icahn tweeted that him and Apple CEO Tim Cook planned "to speak again shortly," suggesting that Icahn isn't done pressing on this issue.

It's possible that Apple does expand its buyback program in a few years, but that's quite a ways away. The focus on Apple right now, and over the next six months, should be new products. Apple is slated to announce a new iPhone perhaps as soon as Sept. 10, and a new iPad and iPad mini could come in October.

Otherwise, Apple becomes just like any other company, and that's not something shareholders, including Icahn, want to see.

-- Written by Chris Ciaccia in New York

>Contact by Email.

2 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
AAPL $111.96 0.32%
FB $94.31 0.05%
GOOG $654.01 1.10%
TSLA $220.94 2.50%
YHOO $32.45 -1.20%


Chart of I:DJI
DOW 17,118.78 -13.08 -0.08%
S&P 500 2,014.89 +15.91 0.80%
NASDAQ 4,815.5410 -23.1020 -0.48%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs