updated 01:36 am EDT, Fri May 16, 2014
Adds 2.8 million shares for total stake worth $4.4 billion
Tim Cook isn't the only person who is "bullish on Apple's future." Activist investor Carl Icahn, who last year tried unsuccessfully to get Apple to buy back more of its stock in an effort to raise its value, has invested another $1.65 billion into the company, buying 2.8 million shares at around Thursday's closing price of $588.82 per share. His total holding in the company is now more than 7.5 million shares.
As it turned out, Icahn got 90 percent of what he wanted -- Apple's Board of Directors eventually voted to increase the buyback program by an additional $30 billion to a $90 billion total, and has already spent something like two thirds of that amount repurchasing shares. Icahn had lobbied for a $100 billion buyback. In addition, Apple will split its stock 7-to-1 on June 2, lowering the price of a typical share to around $80.
Icahn's current holding is worth about $4.8 billion at today's price, though it is hard to say exactly how much his investment in the company has gone up. It has definitely gone up, however, as Icahn bought most of his shares at lower price points when Wall Street was (rather mysteriously) devaluing the company on the basis that it had failed to bring forth any hugely disruptive products since Steve Jobs' death in 2011. AAPL sunk as low as $393 in the past year, but managed to rise above the low $520-level immediately after announcing the buyback expansion, an annual dividend increase, and unexpectedly strong iPhone sales.
Even before the recent announcements, Icahn called the stock a "no brainer" buy in part due to the original buyback program and the company's ongoing growth, even without all-new flagship products. The iPhone continues to outsell all individual rivals, the iOS platform continues to gain share in some key markets (particularly North America, Japan and China), and Cook has promised that this year will see the release of new products in "new product categories," such as the alleged "iWatch" and rumored Apple TV revamp.