Apple Is Greatly Undervalued, Promising Products Are In the Pipe – Carl Icahn

Carl Icahn’s Multi-Billion Tweet Raises Apple Stock

by Anton Shilov
08/13/2013 | 11:00 PM

No matter how good the Wall Street analyst are in predicting where the stock market is going, it remains completely unpredictable. Apple’s shares are typically up on product announcement and earnings surprises, not exactly on rumours or speculation. Nonetheless, a single tweet from Carl Icahn, a well-known investor, has sent Apple’s stock to rally as he spurred speculation about new products and their potential effect on the company’s earnings and capitalization.

 

“We currently have a large position in Apple. We believe the company to be extremely undervalued. Spoke to Tim Cook today. More to come,” said Carl Icachn in a post over Twitter network.

Apple closed at $489.55, meaning its market capitalization increased $12.5 billion from the time of Icahn’s initial tweet, reports The Exchange, a Yahoo! Financial blog.

It is noteworthy that the tweet came a day after Larry Ellison, the founder and chief executive of Oracle as well as a good friend of Steve Jobs, said that the latter is irreplaceable and Apple will inevitably come down without its legendary chief executive.

Moreover, on Monday Icahn Enterprises disclosed that “the information that Mr. Icahn posts on Twitter (which may include information regarding companies in which we and/or Mr. Icahn have or may be contemplating an investment position) could be deemed to be material information”.

While a comment made by an esteemed investor, such as Carl Icahn, seems to carry value, a more important thing is what made him to issue his point of view. As it appears, the conversation with Tim Cook improved confidence of Mr. Icahn in Apple. Theoretically, this means that Mr. Cook might have disclosed certain plans to the investor, which were impressive enough to make Mr. Icahn to post a $12.5 billion-worth tweet.

Later this year Apple is expected to introduce two new iPhone smartphones, one aimed at premium and another designed for mainstream market segment; release at least two new iPad media tablets, one full-sized and another one with 7.9” display; start to sell all-new Mac Pro desktop; unleash displays with 4K resolution (or retina-class displays) and release two new operating systems.

Apple did not comment on the news-story.