Dear Valued Visitor,

We have noticed that you are using an ad blocker software.

Although advertisements on the web pages may degrade your experience, our business certainly depends on them and we can only keep providing you high-quality research based articles as long as we can display ads on our pages.

To view this article, you can disable your ad blocker and refresh this page or simply login.

We only allow registered users to use ad blockers. You can sign up for free by clicking here or you can login if you are already a member.

Apple Inc. (AAPL): Does Carl Icahn Know About Game Theory?

If you think Carl Icahn’s letter to Tim Cook, Apple Inc. (NASDAQ:AAPL)‘s CEO, was delivered with the best of intentions for the company’s management, think again. Carl Icahn knew before he even wrote that letter that his request will be thrown to the wolves by the company’s management. These wolves are Apple Inc. (NASDAQ:AAPL) investors and the biggest clue of this narrative, which I will unveil here, was provided by Tom Keene on Bloomberg.

Largest Online Retailers in the World

Keene walked through Matt Levine’s article on Bloomberg News, which basically revealed that if Icahn wanted Apple Inc. (NASDAQ:AAPL) to benefit from the share buyback program, considering of course that Icahn’s valuation for Apple, $203 per share is correct, he would have sent the letter privately, so that other investors don’t start putting an upward pressure on the price before Apple Inc. (NASDAQ:AAPL) initiates its buyback program.

“[…] Matt Levine walks through the game theory of what is going on and the most interesting thing in his essay, Adam, is that the letter should have been private. He [Carl Icahn] should have just sent it to Mr. Cook, […]” said Keene.

However what both Keene and Levine failed to realise is that Icahn doesn’t really care about Apple’s management. All he cares about is his investment in the company. He knew there weren’t going to be any more share buyback programs. Apple Inc. (NASDAQ:AAPL) is already in the midst of an intensive program of such sort. Therefore, he wanted the other investors to take his valuation seriously and push the price of Apple Inc. (NASDAQ:AAPL)’s stock higher without even needing the intervention of a board or lawyers.

To this end, Icahn even put up a nice advertisement campaign for his letter, or in more precisely Apple Inc. (NASDAQ:AAPL)’s valuation of $203, using his tweet to stir some action in the investment circles.

Apple Inc. (NASDAQ:AAPL)  is currently trading at $101, which would put the value of this attempted manipulation to a nice healthy figure of $102 per share.

Disclosure: none

Warren Buffett and BillionairesFree Report: Warren Buffett and 12 Billionaires Are Crazy About These 7 Stocks

Let Warren Buffett, David Einhorn, George Soros, and David Tepper WORK FOR YOU. If you want to beat the low cost index funds by an average of 6 percentage points per year look no further than Warren Buffett’s stock picks. That’s the margin Buffett’s stock picks outperformed the market since 2008. In this free report, Insider Monkey’s market beating research team identified 7 stocks Warren Buffett and 12 other billionaires are crazy about. CLICK HERE NOW for all the details.

Biotech Stock Alert - 20% Guaranteed Return in One Year

Hedge Funds and Insiders Are Piling Into

One of 2015's best hedge funds and two insiders snapped up shares of this medical device stock recently. We believe its transformative and disruptive device will storm the $3+ billion market and help it achieve 500%-1000% gains in 3 years.

Get your FREE REPORT and the details of our 20% return guarantee today.

Subscribe me to Insider Monkey's Free Daily Newsletter
This is a FREE report from Insider Monkey. Credit Card is NOT required.
Loading Comments...

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 102% in 3 years!! Wondering How?

Download a complete edition of our newsletter for free!