Apple Inc. (AAPL) Will Return >$130 billion To Shareholders By The End Of 2015


Apple Inc. (NASDAQ:AAPL)’s CEO Tim Cook received an open letter from activist investor Carl Icahn. He asked the company to accelerate the stock repurchasing in order to realize the true value of Apple shares, which Icahn thinks is currently undervalued. Icahn’s Icahn Capital Lp hold around 53 million shares and is currently the largest Apple Inc. (NASDAQ:AAPL) shareholder. Meanwhile, Apple has responded to Icahn’s letter. CNBC’s Carl Quintanilla reported the Apple’s response to Icahn’s letter in CNBC.

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“We always appreciate hearing from our shareholders. Since 2013 we’ve been aggressively executing the largest capital return program in corporate history. As we’ve said before, we will review the program annually and take into account the input from all of our shareholders,” Quintanilla quoted Apple Inc. (NASDAQ:AAPL)’s response.

Apple Inc. (NASDAQ:AAPL)’s responded that the company was already very aggressive in executing the share buybacks and will take all shareholders opinion to review the buyback plans for future.

Apple Inc. (NASDAQ:AAPL) has also released a table along with its response, stating the quarter-wise capital returned to shareholders from fourth quarter in 2012. Apple has returned a total of $74.3 billion to its shareholders by the end of third quarter in 2014 and the company has plans to return $130 billion more to shareholders by the end of 2015.

Icahn believes that Apple Inc. (NASDAQ:AAPL) should be trading at a price to earnings per share ratio of 19 times his estimates, which is currently trading at 8 times his estimates. He thinks that with 19x P/E ratio estimates, Apple shares should be trading at a whopping $203 per share, which is hovering around $100 per share mark right now.

Apple Inc. (NASDAQ:AAPL)’s response did had any direct reply to Icahn’s proposal, so what will Apple Inc. (NASDAQ:AAPL) do next with share buyback plan is still unknown.

As of 30 June 2014, Carl Icahn‘s Icahn Capital Lp hold around 52.8 million Apple Inc. (NASDAQ:AAPL) shares.

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