Feb. 7 (Bloomberg) -- Apple Inc. rose after saying it bought back $14 billion in stock in the two weeks since reporting iPhone sales that fell short of analysts’ estimates and sent its shares lower.
Chief Executive Officer Tim Cook said in an interview with the Wall Street Journal that Apple was “surprised” by the 8 percent stock drop on Jan. 28. Alan Hely, a spokesman, confirmed the repurchases in an e-mailed statement. The shares rose 1.4 percent to $519.68 at the close in New York.
Apple’s iPhone sales over the holiday season and revenue forecast for the current quarter were lower than analysts anticipated last month, adding to evidence that its flagship product is losing steam. Billionaire activist investor Carl Icahn, who has been pressuring the company to boost buybacks, last month called for a $50 billion repurchase in fiscal 2014. The investor said Jan. 28 that he added $500 million to his $3.6 billion stake in Apple.
Apple bought $12 billion of its shares in an “accelerated” program and $2 billion on the open market, Cook said in the Journal interview. With those latest repurchases, the Cupertino, California-based company has bought back more than $40 billion of its shares over the past 12 months, Cook said. It means Apple is “really confident” in its plans, the CEO said.
Icahn wrote in a tweet that Apple should “keep buying” and that the stock is undervalued.
In April, before Icahn’s involvement, Cook announced a plan for a total of $100 billion in dividends and buybacks.
The shares are down 7.4 percent this year after gaining 5.4 percent in 2013, underperforming the Standard & Poor’s 500 Index in both periods. The index had fallen 2.8 percent this year after jumping 30 percent last year.
Apple has recommended investors vote against Icahn’s plan. The company has won the support of proxy adviser Egan-Jones Ratings, which recommended investors side with Apple.
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