Carl Icahn is long Apple Inc. (NASDAQ:AAPL).
It’s really just that simple. The meteoric hedge fund manager reported it via Twitter a few minutes ago, and it’s hard to say we didn’t see a big move coming.
Last week, in a feature from the FOX Business Network, we discussed Icahn’s comments on Herbalife Ltd. (NYSE:HLF) and Dell Inc. (NASDAQ:DELL), in addition to his admission that a new position may be coming out very soon. Here was his full quote, on whether or not he had a large position:
“I have to say we do. We may put something out on it relatively soon. I think we’ll put it on Twitter but obviously all the news people are followers. In any event, I think it’s a good thing I want to try to build a following and then see if we can make some changes to corporate governance one day.”
It’s clear that now, Icahn was talking about Apple. Apple Inc. (NASDAQ:AAPL) received another large backer earlier today when we reported that Jim Simons and Renaissance Technologies bought Apple and sold Google Inc (NASDAQ:GOOG) last quarter. With Simons and Icahn, Apple also has billionaire David Einhorn in the fray, along with Christopher R. Hansen and D. E. Shaw.
Apple is up 3.3%–and climbing–on news of Icahn’s stake, and we can’t help but wonder if he’ll pursue an activist strategy with Tim Cook, Jony Ive and the rest of Cupertino’s management.
Apple Inc. (NASDAQ:AAPL) was the most widely held stock in the top-tier hedge fund universe (of about 525 funds) at the end of the first quarter, so we’ll be watching the aggregate data very closely.
Just to note, shares of Apple currently trade at a forward P/E of 11.04 and a bargain bin PEG below 0.7. We see a few scenarios that can lead shares back to a fairer valuation, including: a deal with China Mobile, a lower cost iPhone for emerging markets, or a groundbreaking device like an “iTV” or an “iWatch.”
Obviously, an activist investor like Carl Icahn can also add value to the company, possible by pursuing a dividend hike or by pushing for a purchase, perhaps of a company like BlackBerry Ltd (NASDAQ:BBRY) or Yelp Inc (NYSE:YELP).
We’ll keep you posted, but in the meantime, check out this video of Carl Icahn’s thoughts on activism and his latest investments (pre-Apple Inc. (NASDAQ:AAPL)):