After taking an undisclosed “large position” in Apple last month, rumored to be in excess of $1B, prominent investor Carl Icahn said he thinks Apple and CEO Tim Cook should do a larger buyback. Now, following a scheduled meeting with Tim Cook in New York yesterday, Icahn says he “pushed hard for a 150 billion buyback” during a “cordial dinner”:
While Apple announced earlier this year that it would return around $100 billion to shareholders by the end of 2015 as part of its $60 billion buyback program and increased dividend, Icahn previously told Reuters he thinks Apple is capable of doing a $150 billion buyback by borrowing the money at 3 percent:
“If Apple does this now and earnings increase at only 10 percent, the stock – even keeping the same multiple currently – should trade at $700 a share,” Icahn said in a phone interview. Apple has “huge borrowing power, little relative debt and trades at a low multiple.”
As noted in his tweet above, Icahn says he will resume talks with Cook regarding the buyback in three weeks.
Update: we’ve embedded the CEO’s conversations on video to CNBC below: