Morgan Stanley adds AAPL to Best Ideas list for investors, citing high iPhone 6/Plus margins

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Morgan Stanley’s Katy Huberty has added AAPL to its Best Ideas list of investments, saying that increased margins from iPhone 6 sales see the stock “set for significant upside.”

While Credit Suisse had earlier suggested that margins on the iPhone 6 would be lower than that of the iPhone 5s and 5c, Huberty says that numerous sources are suggesting that more people this time are opting for the middle storage tier, thus pushing up both average selling price and margins …  Read more

Carl Icahn forecasts UltraHD Apple TV set in FY 2016

Apple TV products

Included in activist shareholder and investor Carl Icahn’s open letter to Apple CEO Tim Cook requesting an increased stock buyback from the company is somewhat of a prediction about when Apple might release an actual Apple TV set, not just an updated set-top box. Icahn sees fiscal year 2016 as an opportunity for Apple to enter the home television market citing an upgrade cycle due to UltraHD displays.

As we highlighted in our previous letter, we believe UltraHD’s (ultra-high-definition television) superior picture quality in comparison to regular HD will drive a major TV replacement cycle as the price gap between them narrows. It should also be noted that Reed Hastings, CEO of Netflix, has referenced UltraHD as a major catalyst for Netflix going forward, and while this is true for Netflix, we believe it is also true for Apple. Against the backdrop of this replacement cycle, FY 2016 represents an opportune time to introduce an UltraHD TV set.

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Carl Icahn publishes open letter to Tim Cook, requests Apple increase buyback through tender offer (U: Apple statement)

Tim Cook

High-profile investor and Apple shareholder Carl Icahn has published an open letter to Apple CEO Tim Cook urging him to once again increase its share repurchase program for stock holders. Citing strong iPhone 6 sales and predicting the larger devices will help Apple gain marketshare from Android, Icahn is requesting Cook and Apple’s board make a tender offer to increase its current rate of share repurchases. Icahn said he thinks Apple remains “dramatically undervalued in today’s market,” but didn’t suggest a specific number for the increased buybacks: Read more

Apple to increase share buybacks to $90 billion, announces seven-to-one stock split, increase dividend to $3.29 per share

 

D11 Tim Cook

As part of Apple’s earnings releases, Apple has announced an extension to its buyback plans. The company will now buyback an additional $30 billion of Apple stock, totalling $90 billion, significantly accelerating its original plans.

Apple® today announced that its Board of Directors has authorized another significant increase to the Company’s program to return capital to shareholders. The Company expects to utilize a total of over $130 billion of cash under the expanded program by the end of calendar 2015.

The board has also announced a seven-for-one stock split beginning June 2nd 2014. Apple last split its stock in 2005, nine years ago. Apple will also increase the dividend by about 8 percent to $3.29 per common share. This will begin on May 15th. Apple plans to increase its dividend every year. In an interview with the Wall Street Journal, Cook said that the buyback will “show you how much confidence we have in the future of the company”.

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Carl Icahn announces third $500 million AAPL purchase this month after earnings report

As Apple opened down nearly 8% following yesterday’s earnings report from the previous quarter, activist investor Carl Icahn announced this morning his third $500 million purchase of Apple stock since the start of the month. Icahn has notably made a lot of noise being vocal toward Apple’s Board of Directors urging a larger buyback program for shareholders, something Apple’s Board has taken a position against, and today’s investment pegs Icahn’s ownership somewhere around $4.1 billion. Icahn’s recent purchases come ahead of Apple’s scheduled shareholder meeting on February 28, 2014. Read more

Carl Icahn adds another $500 million into $AAPL, total now at $3.6 billion and closing in on 1% ownership

Just yesterday, activist investor Carl Icahn revealed that he has invested another $500 million into AAPL stock. Just around 24 hours later, Icahn has posted on Twitter that he invested another $500 million. That brings his total investment into Apple stock to $3.6 billion. This means that he is closing in at 1% ownership of Apple’s stock…

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Icahn says Apple “doing great disservice to shareholders,” increases AAPL investment to $3B

Following a precatory proposal from billionaire investor and Apple shareholder Carl Icahn urging Apple to vote on a larger buyback, Icahn today announced on Twitter that he thinks Apple “is doing great disservice to shareholders by not having markedly increased its buyback.” He also said that he would soon send Apple another in-depth letter regarding his proposals and confirmed that he has purchased another $500 million in Apple shares bringing his total investment to $3 billion.  Read more

Tim Cook’s revised stock deal cost him $4M this year

Photo: mashable.com

Photo: mashable.com

ComputerWorld noted that Apple’s SEC filing on Friday revealed that Tim Cook lost out on $4M worth of stock as a result of his request to the board in August to revise his compensation arrangements to a deal he felt was fairer to shareholders.

Earlier this year Apple’s board revised Cook’s vesting schedule at his urging. Rather than the two monster stock handouts — which only relied on his continued employment — Cook asked that they be spread out over a 10-year period and tied to the company’s stock performance …  Read more

Institutional money and Icahn shenanigans have AAPL headed back to 52-week highs

aapl

Less than a week after AAPL stock reached a new high for 2013, and two analysts raised their target price in response to Black Friday sales, the stock has also hit a 52-week high, running at $570 at the point of writing.

Billionaire investor Carl Icahn doubtless played a role, yesterday tweeting that he would be calling for a (non-binding) shareholder vote on an increased buyback program – though for a smaller amount than he had originally urged.

But Fortune yesterday posted a rather interesting chart that may suggest the upward trend will continue …  Read more

AAPL goes into the Black for 2013 on Black Friday as it hits $550

550

We mentioned a couple of days ago that AAPL stock was approaching a high for the year, and it has now broken the $549.02 at which it began the year.

The company has experienced a roller-coaster ride in its stock price, almost entirely divorced from any product-based reality. The value placed on the company by the market at any given time has more to do with the gap between rumors and product launches, and of course short-term speculation …  Read more

Carl Icahn urges $150B Apple buyback in letter to Tim Cook, increases investment to $2.5B

Carl-iCahn-shareholders-roundtable

Following an announcement yesterday from billionaire investor Carl Icahn that he had sent a letter to Apple CEO Tim Cook and would post the full letter online today, Icahn’s new website has now officially launched with the full text of the letter. In the letter on Icahn’s new website called the Shareholders’ Square Table, the investor urged Tim Cook to implement the $150 billion buyback plan that he has been suggesting since first announcing in August that he had taken a “large position” in Apple:

The S&P 500 trades at roughly 14x forward earnings. After backing off net cash, Apple trades at just 9x (not factoring into account that the company has a significantly lower cash tax rate than the rate Wall Street analysts use). This discount (cash adjusted) becomes even more compelling given our confidence that Apple will grow earnings per share at a rate well in excess of the S&P 500 for the foreseeable future. With such an enormous valuation gap and such a massive amount of cash on the balance sheet, we find it difficult to imagine why the board would not move more aggressively to buy back stock by immediately announcing a $150 Billion tender offer (financed with debt or a mix of debt and cash on the balance sheet).

While this would certainly be unprecedented because of its size, it is actually appropriate and manageable relative to the size and financial strength of your company. Apple generates more than enough cash flow to service this amount of debt and has $147 billion of cash in the bank. As we proposed at our dinner, if the company decided to borrow the full $150 billion at a 3% interest rate to commence a tender at $525 per share, the result would be an immediate 33% boost to earnings per share, translating into a 33% increase in the value of the shares, which significantly assumes no multiple expansion. 

In the letter Icahn adds that if the proposed $150 billion buyback was executed immediately, Apple would experience “further stock appreciation of 140% for the shareholders who choose not to sell into the proposed tender offer.” Icahn also agrees to not participate in the buyback by withholding his shares to “ invalidate any possible criticism” regarding the long term benefits of the proposal.

Icahn also noted that he has increased the size of his position in AAPL from 3,875,063 shares to 4,730,739 shares, a value of around $2.5 billion, and that he intends to buy more.

While there isn’t a ton of new information regarding Icahn’s new website, it is already accepting sign ups and a description on the website explains it as “a platform from which we can unite and fight for our rights as shareholders and steer towards the goal of real corporate democracy.”

Icahn says that Cook will call him after the October 28th earnings announcement.

Icahn’s full letter to Tim Cook is below:

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