Carl Icahn, who disclosed a $1 billion stake in Apple Inc. (AAPL) in August, said he had dinner with Chief Executive Officer Tim Cook and “pushed hard” for a $150 billion share buyback. Talks will continue in about three weeks, said Icahn, the billionaire activist investor who has made a career of urging companies to adopt changes to boost the value of shareholdings. While Cook announced a plan this year for a total of $100 billion in dividends and share repurchases, Icahn wants Apple to allocate $150 billion more for buybacks. The iPhone maker, which had $146.6 billion in cash and investments at the end of June, should also focus on boosting profitability to satisfy investors, according to Alex Gauna, an analyst at JMP Securities LLC in San Francisco. “To justify the valuation on the stock, it’s got to get back to earnings growth,” said Gauna, who has a market-perform rating on Apple’s stock. “They have to be always innovating and putting in place the mechanisms for growth, or it doesn’t matter how much cash they return to shareholders.” The shares of Cupertino, California-based Apple rose 2.4 percent to $487.96 at the close in New York. The stock has declined 8.3 percent this year, compared with a 19 percent gain in the Standard & Poor’s 500 Index. Apple said in July that it bought back $16 billion of stock in the latest quarter. Steve Dowling, a spokesman for Apple, declined to comment.
Posted on: Wed, 02 Oct 2013 07:03:01 +0000
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