Apple ‘extremely undervalued’ says billionaire Carl Icahn

Jordan O'Brien
August 14, 2013

Apple shares have soared after it was revealed that billionaire Carl Icahn had invested heavily in the company, claiming that it was ‘extremely undervalued’.

According to various reports, it is thought that Icahn has amassed over $1 billion in Apple stock. Although that sounds a lot, with Apple’s market capitalisation currently standing at $444 million, it’s less than a percent.

Icahn took to Twitter to announce the move, adding that he’s in talks with Tim Cook about the possibility of a larger buy back.

After Icahn’s shock announcement Wall Street jumped at the opportunity of buying Apple stock, sending Apple’s share value up some 4.75%, adding over $17 billion to the overall value of the company.

Evidently Icahn has bought the stocks in the hope that Tim Cook will buy them back at a higher price, but he also thinks that Apple’s stock value should be higher. In an interview with Reuters, Icahn said that Apple should be trading at $700 per share, but it could only do so if it increased earnings and had bigger buybacks. He also told the Wall Street Journal that even without increased earnings, Apple’s shares should be trading at $625.

If Apple were to trade at $700 per share, it would get back to the days after the iPhone 5 announcement, where it peaked at $705.

Larry Ellison recently said that he had little hope for an Apple without its legendary founder Steve Jobs, but it looks like Icahn can see true leadership in Tim Cook.

Icahn currently has his fingers in a lot of pies, as he is attempting to derail Michael Dell’s plan on taking his namesake company private, whilst also attempting to buy the company himself.

Source: The Verge

About the Author

Jordan O'Brien

Technology Journalist with an unhealthy obsession with trains and American TV. Attempts satire far too often. (+44) 020 7324 3502

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