Carl Ichan’s recent lunch with Tim Cook

Carl Icahn, known as an “activist shareholder,” said he feels very strongly that Apple should be increasing their already huge stock buyback. He wants Apple to more than double their buyback program.

In a telephone interview with CNBC, he talked about a lunch he had with Tim Cook and Peter Oppenheimer, Apple’s CFO. Icahn, who could also be characterized as an institutional gadfly, takes the position in the interview that Apple’s board needs to listen to it’s shareholders. Presumably, by shareholders, he means himself.

This is what you have to understand about Icahn, he doesn’t hold shares of Apple, the consumer company. No, he holds shares of AAPL, a stock listing. Icahn could care less about the company’s health, prospects, or future plans. He couldn’t be less concerned about how many people Apple employs, or whether it is leading American industry. He just wants to see the value of his shares grow. Period.

Well, Mr. Icahn, I’m an Apple shareholder too. But unlike you, I invested in the company, not the stock. I bought Apple stock as soon as I could afford to and, while I have sold some shares to diversify my portfolio, I have owned a very small piece of Apple for over ten years now, and my returns have been more than adequate. Probably better as a percentage of my original investment than any stock buy back would do for you.

I hope that Tim Cook, and the board of Apple, will feel free to ignore Icahn because Icahn’s not invested in the company, he’s only invested in the stock price, in his own greed. Sure, he might file a lawsuit to try and effect the changes he wants, but ultimately I think the majority of Apple’s shareholders understand the difference between investing in a company with a future and a stock with a price.

PS: At one point In the telephone interview, Icahn mistakenly characterizes the current $60B stock buyback program at $16B, which he says is “nothing.”  I think Tim should follow Henry Blodget’s advice. Apple, and its board, are clearly more on top of things than Icahn could ever hope to be.


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