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So it turns out that that old bit of advice that we've almost all received is a bit off--it really does matter what some people think of you. Specifically, if you're Apple and investors Carl Icahn and Lee Cooperman think your company's "extremely undervalued," it'll drive your stock up to levels it hasn't seen in months.
That's what's happened over the last couple of days, when Icahn and Cooperman's announcements that they'd secured a substantial amount of Apple's stock (even if Cooperman called his investment a "modest position") drove the Cupertino giant's stock price above $500 for the first time in over seven months. If you recall, Apple first broke the $500 barrier in February of last year, and it soared up to a whopping $705 a share by September.
That could happen again, Icahn and Cooperman believe. According to a transcript from Scott Wapner at CNBC (via MacRumors): "Lee Cooperman is thinking that the new iPhone is going to create some buzz. When talking about the entire space, he says he still thinks that Qualcomm is the best play in that overall space. But clearly making it known that he agrees with Carl Icahn that Apple is cheap in his words. They got back in in the low $400s and think the new iPhone which is expected on September 10th is going to create some buzz and you know Apple was right on the cusp of $500."
Icahn's total investment this week totaled around $1.5 billion, as reported by the Wall Street Journal yesterday. As Icahn said in yesterday's WSJ: "'This is a no brainer to go buy stock in a company that can go borrow' at a low rate, Mr. Icahn said. 'Buy the company here and even without earnings growth, we think it ought to be worth $625.' 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. That would send shares to $625, Mr. Icahn says, without taking into account any earnings growth."
At the time of writing, Apple's stock price rested at $498.50, slightly down from the day's high of $504.25.
Follow this article's writer, Leif Johnson, on Twitter.