SAN FRANCISCO (MarketWatch) — With its market value still more than 30% below its peak, Apple Inc. has drawn the gaze of investor activist Carl Icahn, who announced a “large position” on the iPhone maker’s stock on Tuesday afternoon. 
 
 
 
 Bloomberg 
 
 The announcement — made through a pair of tweets — gave a notable boost to Apple’s (NASDAQ:AAPL) stock, which was up more than 4.7% to $489.57 by the closing bell. The shares were up about 1.8% prior to Icahn’s announcement. 
 
 “We currently have a large position in Apple. We believe the company to be extremely undervalued,” Icahn tweeted. 
 
 In another message, he said he had a “a nice conversation with [Apple CEO] Tim Cook today,” adding that they “discussed my opinion that a larger buyback should be done now.” Icahn added that “We plan to speak again shortly.” 
 
 Icahn has recently taken to announcing significant actions over Twitter, including moves related to his battle against a privatization deal at Dell Inc. (NASDAQ:DELL) . In related news, the National Investor Relations Institute is floating a proposal for rules that would require large investors to disclose their investment stakes more frequently. 
 
 Apple, which reported a total cash hoard of more than $146 billion by the end of June, has long been under pressure to return more cash to shareholders — especially over the last year, as its sales growth has slowed and earnings have begun to decline. That has contributed to a sharp decline in the company’s market value, as its stock peaked just above the $700 mark in late September and was on a mostly downward slope for the first half of this year. 
 
 The company began a $10 billion stock buyback last year and boosted that program to $60 billion on April 23. The company has not communicated plans to raise that level further. 
 
 “We appreciate the interest and investment of all our shareholders,” Apple spokesman Steve Dowling said in an email. “Tim had a very positive conversation with Mr. Icahn today.” 
 
 Apple’s shares have been on the rise of late, picking up nearly 18% since late July on rising anticipation of the next round of expected product launches this fall. The stock also rose above its 200-day moving average on Tuesday prior to Icahn’s announcement. 
 
 Click to Play Apple jumps on Icahn stake Activist investor Carl Icahn said on Twitter that he has taken a "large" position in Apple and urged its CEO to step up stock buybacks. David Benoit reports. Photo: AP. 
 
 Over the weekend, the AllThingsD technology blog reported that the company would unveil its next iPhone at a Sept. 10 media event. The Wall Street Journal reported Monday that Apple is building its next large iPad with the same thin, lightweight it used on the iPad mini. Analysts widely expect the new iPads to be unveiled in October. 
 
 This is not the first time Apple has come in the sights of activist investors. Earlier this year, the company found itself enmeshed in a battle with David Einhorn of Greenlight Capital, who was pressing for a new class of preferred stock as a way for Apple to return more of its large cash horde to shareholders. 
 
 For more: Apple-heavy ETF primed for breakout. 
 
 U.S. stocks rise with help from Apple. 

 Activist investor Carl Icahn said on Twitter that he has taken a "large" position in Apple and urged its CEO to step up stock buybacks. David Benoit reports. Photo: AP. 
 
 Investor Carl Icahn has grabbed a stake valued at over $1.5 billion in Apple Inc., believing that more cash should be falling from the tech giant's branches. 
 
 Specifically, Mr. Icahn is pressing the company to buy back shares now. 
 
 While Apple earlier this year announced a large buyback, Mr. Icahn said in an interview Tuesday that he wants to see it happen right away, near the current share price, which he considers cheap. 
 
 "This is a no-brainer to go buy stock in a company that can go borrow" at a low rate, Mr. Icahn said in an interview. "Buy the company here and even without earnings growth, we think it ought to be worth $625," he said, referring to the stock price, which closed Tuesday at $489.57, having risen 5% on the news of Mr. Icahn's investment. 
 
 Mr. Icahn's thesis rests on Apple borrowing at about a 3% interest rate and buying back shares right now, likely at around $525 a piece. A stock buyback can increase earnings per share by reducing the number of shares outstanding. 
 
 Using Twitter on Tuesday to publicize his move, Mr. Icahn—who is known for buying large positions in various companies and then agitating for change—said he had a "nice" conversation with Tim Cook, Apple's chief executive, and discussed his opinion that "a larger share buyback should be done now." He added that he plans to speak with Mr. Cook again "shortly." 
 
 The tweets didn't disclose the size of the stake but a person familiar with the position said Mr. Icahn's stake is worth more than $1.5 billion. 
 
 Wielding influence at Apple won't be easy, or inexpensive, given a stock market value that currently stands at close to $450 billion. At that capitalization, Mr. Icahn's stake would be less than 1%. 
 
 Steve Dowling, an Apple spokesman, said the company appreciates the interest and investment of all its shareholders. "Tim had a very positive conversation with Mr. Icahn today," he said, without elaborating. 
 
 The investment is the second time in recent months an activist investor has targeted Apple, adding to the pressures on a company whose shares have dropped sharply since reaching all-time highs above $700 a share in September. 
 
 Earlier this year, David Einhorn, founder of Greenlight Capital Inc., pushed Apple to return more money to shareholders through a preferred stock plan. In a series of statements, Mr. Einhorn criticized Apple for being stingy with its large and growing cash reserves. 
 
 Apple said it believed it was taking the most prudent course, and in April increased its buyback authorization to $60 billion from the $10 billion announced last year. The company said the move marks the largest single share repurchase authorization of any company in history and it is expected to finish by the end of calendar 2015. 
 
 In July, Apple said it had already spent $16 billion to repurchase shares in its third quarter ended in June. 
 
 Mr. Icahn's use of his Twitter account for the news was an unusual move in itself, marking one of the first times such a position has been initially disclosed through the medium. 
 
 Mr. Icahn has lately been engaged in a battle over the future of Dell Inc., whose CEO and founder is trying to take the company private. Mr. Icahn holds a stake of nearly 9% in the computer maker. 
 
 In the interview Tuesday, Mr. Icahn, who plays chess on his iPad, said he made the Apple investment on the advice of his son Brett Icahn and investment partner David Schechter, who have been looking at the technology sector for Icahn Enterprises LP. 
 
 Those two also led Mr. Icahn's successful investment in video provider Netflix Inc. where they have made $1 billion in less than a year. They pitched Mr. Icahn on Apple's solid cash position and its ability to borrow with ease to fund a massive stock buyback, Mr. Icahn said. 
 
 They also are bullish on Apple's ability to increase earnings, and expressed enthusiasm over the possibility that Apple's coming products, such as the widely anticipated watch and television, will drive sales. 
 
 Analysts have expressed concerns about a slowing pace of innovation at Apple, arguing that it hasn't launched a brand new product line since it released the first iPad in 2010. Other missteps for the Cupertino, Calif., trendsetter include a widely panned new mapping service for its iPhones and iPads. 
 
 On the financial front, the company has been under heavy scrutiny by various investors complaining about the size of its cash stockpile, which was recently reported as $146.6 billion. In March last year, Apple agreed, saying it had more cash than it needed to run its business, and began a dividend and share buyback program. 
 
 Mr. Icahn's move into Apple is the latest example of activist investors pursuing big game, in this case the largest company in the Standard & Poor's 500-stock index. For executives and boards of companies large and small, anticipating, managing and responding to activist shareholders has emerged as a significant and ongoing task, not to mention a source of revenue for advisers on Wall Street who help companies with the challenge. 
 
 What is unclear is what comes next. Mr. Icahn's typical investment methods are to buy a large chunk of a company stock and agitate for changes to the company's management, how they use cash or other strategies he believes will boost stock prices. 
 
 Mr. Icahn also is known for picking fights with executives and directors of companies he believes aren't acting in the interests of shareholders, including management at technology companies such as Netflix and Yahoo Inc. So far, both Mr. Icahn and Apple said the talks were amicable. 
 
 In his battle involving Dell, Mr. Icahn argues that CEO Michael Dell's plan for a buyout amounts to theft from shareholders. 
 
 In his bid to derail the proposed $24.8 billion deal, Mr. Icahn has said repeatedly in interviews that he wants to fire Mr. Dell as CEO. He added in a public letter that Mr. Dell has been "whining" about the terms of the buyout deal. 
 
 Last month, the Dell special committee reviewing the transaction said it had "reservations" about Mr. Icahn's methods of valuing Dell's stock, and directors have criticized him for abandoning repeated proposed deals involving the company. 
 
 Gene Munster, an analyst at Piper Jaffray, said Mr. Icahn's investment serves as an acknowledgment that better things could be coming from Apple over the next six months, which should help raise the company's stock. But he doesn't expect Mr. Icahn's influence to have much impact beyond the way Apple allocates its capital. 
 
 Share buybacks have enjoyed newfound popularity in the last couple of years, after companies that hoarded cash in the wake of the financial crisis have looked for ways to put it to work. 
 
 The outcome of a buyback can depend on a number of factors, including whether the company takes the stock out of circulation or gives it to executives, who might later sell it. Some investors view buybacks as a sign of strength, indicating that a company believes its shares are undervalued; others view it as an admission that the company is short on ideas for ways to invest its excess cash. 
 
 —Shira Ovide contributed 
 
 to this article. 
 
 Write to Ian Sherr at ian.sherr@dowjones.com and David Benoit at david.benoit@dowjones.com 
 
 A version of this article appeared August 13, 2013, on page B1 in the U.S. edition of The Wall Street Journal, with the headline: Icahn Pushes Apple on Buyback. 

 Investor Carl Icahn speaks at the Wall Street Journal Deals & Deal Makers conference at the New York Stock Exchange in this June 27, 2007 file photograph. 
 
 SAN FRANCISCO/NEW YORK | 
 
 SAN FRANCISCO/NEW YORK (Reuters) - Activist investor Carl Icahn said he has amassed a "large position" in Apple Inc and believes the stock could be worth as much as $700 a share if Chief Executive Tim Cook pushed for a larger stock buyback. 
 
 The surprise revelation from the billionaire activist caused a stir on Wall Street and pushed Apple's stock almost 5 percent higher to close at a 7-month high of $489.57 on the Nasdaq on Tuesday. 
 
 Icahn said on Twitter that he had a "nice conversation" with Cook on Tuesday and they planned to speak again soon. Apple confirmed the conversation took place, but did not say if it influenced management's view of buybacks. 
 
 Icahn told Reuters that the iPhone, iPad and Mac computer maker has the ability to do a $150 billion buyback now by borrowing funds at 3 percent. 
 
 "If Apple does this now and earnings increase at only 10 percent, the stock - even keeping the same multiple currently - should trade at $700 a share," Icahn said in a phone interview. Apple has "huge borrowing power, little relative debt and trades at a low multiple." 
 
 Icahn, who this year launched an assault on Michael Dell's $25 billion effort to take Dell Inc private, did not say how many shares of Apple he holds. 
 
 A source familiar with the matter, who declined to be named because Icahn hasn't disclosed his holdings in Apple, said the investor's stake was worth around $1 billion, a fraction of the company's market value of more than $400 billion. 
 
 U.S. rules require investors to disclose stakes of 5 percent or larger within 10 days of hitting that threshold. 
 
 In April, Apple bowed to Wall Street pressure and said it would return $100 billion to shareholders by the end of 2015 - double the amount set aside previously. It got there in part by raising its dividend 15 percent and boosting its share buyback program six-fold to $60 billion, one of the largest of its kind. 
 
 The news gave Apple shares a lift, but they remain down more than 30 percent since hitting a record high of $702.10 in September 2012, pummeled by fears of slowing growth and thinning margins amid competition from Samsung Electronics. 
 
 "We currently have a large position in Apple. We believe the company to be extremely undervalued," Icahn said in one of two tweets about Apple on Tuesday. 
 
 "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," he said in his second tweet. 
 
 Icahn is the second prominent activist to target Apple this year. The company had averted a dispute with hedge fund manager David Einhorn of Greenlight Capital, who sued Apple to try to block a proposal regarding voting on preferred shares. 
 
 Apple eventually withdrew the proposal. Einhorn's $8 billion hedge fund is a major shareholder and owned about 2.4 million shares of the company as of the end of the first quarter. 
 
 "We appreciate the interest and investment of all our shareholders," Apple said in a statement on Tuesday in response to Icahn's tweets. "Tim had a very positive conversation with Mr. Icahn today." 
 
 STILL EDGY ENOUGH? 
 
 Analysts said Icahn's interest in Apple helped cement improving sentiment on the stock, as investors began to anticipate a new line-up of gadgets in the fall, including possibly a cheaper iPhone that can spearheard a deeper drive into fast-growing emerging markets. 
 
 Speculation has persisted also that the company may be planning some sort of TV or smartwatch product - worn on the user's wrist - in the near future. 
 
 Cook said last month there will be products "in new categories" but gave no details. 
 
 Apple bought about more than $16 billion worth of stock in the June quarter, much more than analysts had expected. 
 
 "It's a heavyweight investor who can maybe accelerate the (buyback) program," said Morningstar analyst Brian Collelo. "It helps the positive momentum that Apple has seen." 
 
 Others say they saw little need for Apple to expand or speed up its buyback program. Much of the company's $147 billion in cash is held overseas, and that cash cannot be accessed without incurring taxes. As an alternative, Apple raised debt to bankroll its buyback program. 
 
 "It was already greatly increased and there was a debt offering to facilitate that," Hudson Square Research analyst Daniel Ernst said. "I can't say that I agree that the pace of the buyback is tepid." 
 
 Investors' biggest long-term concern about Apple is whether the company has lost its innovative edge. "Product innovation and profitability" are now top priorities, Ernst said. 
 
 Apple's profit fell 22 percent in the June quarter as gross margins slid below 37 percent from over 42 percent a year earlier. 
 
 On Tuesday, about 31 million Apple shares changed hands, almost three times the recent daily average. The stock is now up nearly $20 from its 200-day moving average of around $470. 
 
 Options volume was running three times the average daily turnover with 764,000 calls and 344,000 puts changing hands, according to options analytics firm Trade Alert. 
 
 Apple's options volume also accounted for 11.6 percent of the total single-stock options volume for the day, data from Trade Alert showed. 
 
 (Additional reporting by Doris Frankel in Chicago, and Angela Moon and Sam Forgione in New York; Editing by Matthew Lewis, Tiffany Wu and Richard Chang)
– "We currently have a large position in APPLE," activist investor Carl Icahn tweeted yesterday. "We believe the company to be extremely undervalued. Spoke to Tim Cook today. More to come." That was enough to send Apple stocks soaring up 5%, closing yesterday at $489.57. But Icahn tells the Wall Street Journal that he thinks they should be worth more, and with his "large position"—a sources says it's $1.5 billion worth, though that's probably less than 1%—he's putting the hard word on the tech giant to start buying back shares with its reported $146.6 billion cash stash. Icahn reckons the company could do a $150 billion buyback now, borrowing at 3%. "If Apple does this now and earnings increase at only 10%, the stock—even keeping the same multiple currently—should trade at $700 a share," he says, per Reuters. Apple confirmed the meeting with CEO Cook, but not whether it would be taking Icahn's advice. As MarketWatch notes, even without the help of Icahn's Twitter feed, the company's stocks have been doing well of late, thanks to an upcoming round of product launches: the new iPhone will be unveiled September 10, and a new thinner, lighter iPad is expected in October.