Apple Inc. (NASDAQ:AAPL) is a hedge fund darling, that’s no secret. At the end of the first quarter, it was the smart money’s favorite stock pick, and recent moves by Jim Simons and Carl Icahn have only added to the bullishness.
The two hedge fund managers described above employ very different strategies. Icahn is known for taking aggressive positions in companies via 13D filings, such as his adventures in Chesapeake Energy Corporation (NYSE:CHK) and Dell Inc. (NASDAQ:DELL).
Jim Simons, meanwhile, oversees the Renaissance Technologies (or RenTech for short) network, which has the best hedge fund we’ve ever tracked–the Medallion Fund–in it.
Generally speaking, the support of these two investors should have Apple Inc. (NASDAQ:AAPL) bulls clamoring, as they are also joining other heavyweights. Aside from Simons and Icahn, here are the ten largest hedge funds invested in Tim Cook, Jony Ive, and Cupertino’s ability to bring tech innovation into the next decade and beyond.
1. David Einhorn’s Greenlight Capital has the only $1 billion-plus position, though Icahn’s may very well be larger. It’s worth noting that Icahn’s equity portfolio (via Q1 data) dwarfed Einhorn’s by about $16 billion to $6 billion. Like Icahn, Einhorn is a big supporter of value-creation.
2. D. E. Shaw’s D E Shaw with a $750 million position.
3. Ken Fisher’s Fisher Asset Management has a $650+ million stake.
4. Phill Gross And Robert Atchinson’s Adage Capital Management, close to $600 mil in Apple Inc. (NASDAQ:AAPL).
5. Philippe Laffont’s Coatue Management, $530 mil.
6. Donald Chiboucis’s Columbus Circle Investors, with $311 million.
7. Lee Ainslie’s Maverick Capital with a similar $300+ million stake.
8. Chicago-located Ken Griffin, manager of Citadel Investment Group, with a $283 mil stake.
9. David Tepper’s Appaloosa Management Lp, $240M.
10. Larry Robbins’s Glenview Capital, with $227M.
It was Carl Icahn who once said, “Some people get rich studying artificial intelligence. Me, I make money studying natural stupidity.”
This quote perfectly embodies his thinking with regards to Apple Inc. (NASDAQ:AAPL). It’s not a secret the company is undervalued. A move to a fairer valuation–either via P/E ratios, book multiples, or even earnings growth metrics–would place Apple in the $600-$800 range, and with multiple value-creators on board now, this is a distinct possibility.
There are so many other avenues for the company to travel, however, including M&A activity, increased emerging market presence, a bigger mobile footprint in the Far East, in addition to wearable technology.
In this case, the “natural stupidity” Icahn is likely envisioning is investors’ view toward Apple. Many likely think the tech giant can never recapture old growth, or that it is doomed to churn endless iterations of its current devices to market for infinity, but that’s simply not true.
Apple Inc. (NASDAQ:AAPL) will continue to innovate, and if Carl Icahn and David Einhorn have anything to say about it, shareholders will benefit too. Ken Griffin, Tepper, Simons, and the rest of the gang will be along for the value-based appreciation.
Not a bad crew to be invested in any company with. Not bad indeed.
In case you want to brush up on the company’s comments at WWDC earlier this summer, check it out below: