Activist investor Carl Icahn means trouble with a capital 'T' for Apple

At best, his presence will be a distraction for CEO Tim Cook, not exactly what the doctor ordered for Apple

Corporate raider and investment agitator Carl Icahn put eyes on Apple yesterday, announcing he now had a "large position" in the company and had urged CEO Tim Cook to boost a stock buyback program that has already committed $60 billion to removing shares from the market.

"We currently have a large position in Apple," Icahn tweeted Tuesday. "We believe the company to be extremely undervalued." In a follow-up tweet, Icahn added, "Had a nice conversation with Tim Cook today. Discussed my opinion that a larger buyback should be done now. We plan to speak again shortly."

Apple's stock received the usual "Icahn lift," a pop in trading and share price that inevitably follows news that the billionaire investor has bought a major chunk of a company's shares. By the end of trading Tuesday, Apple's stock price was up 5% to $489.57 per share.

But for one analyst, Icahn's interest in Apple was a nuisance at best and trouble -- with a capital "T" -- at worst.

"This is absolute trouble," said Patrick Moorhead of Moor Insights & Strategy. "There's not one single positive thing [Apple] can take away from his interest, no matter how much you search."

Moorhead based his take on Icahn's reputation -- he's known for agitating for change -- but more importantly, on the investor's role in Michael Dell's ongoing bid to privatize the PC maker that carries his name. Moorhead, who in years past had worked at Dell rival Compaq and supplier AMD, has kept a close eye on Dell for two decades. Recently, he blasted Icahn's counter-proposal.

Icahn typically bulls into a company to demand management changes and advocate the use of cash reserves to boost the share price, including paying higher dividends or buying back shares.

The latter is apparently what Icahn is after at Apple.

In 2012, Apple said it would use $10 billion of its cash horde to fund a share buyback program that would retire shares and thus increase the value of those still remaining. In April, the Cupertino, Calif., company increased the buyback program to $60 billion, which is to be spent through 2015.

Icahn wants more money for buybacks and an acceleration of the program.

At the close of the quarter that ended June 30, Apple had nearly $147 billion in cash, securities and other investments. Most of that, however, was banked overseas. Apple has resisted calls to repatriate it to the U.S. because it would have to pay taxes on those monies.

Apple borrowed some of the money it will spend on the stock buyback program.

In an interview on Tuesday with the Wall Street Journal, Icahn suggested Apple borrow more money -- since interest rates remain low -- to fund a larger buyback.

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