IS CARL ICAHN IN THE MIDST OF A BILL ACKMAN MOMENT?
Perhaps I am a cynic by nature? Perhaps I have been watching events on Wall Street transpire for too long? Or perhaps I realize that the market gods are a fickle bunch that turn their back on even the best of investors at the most public of times?
Whatever this feeling I have regarding Carl Icahn and his love for AAPL is, I know that it is coming from a place where alarms naturally tend to sound whenever someone is so public, enthusiastic and popular in their opinion regarding a company that is so readily admired and adored.
Icahn, it can be argued, is now at the pinnacle of his success. He is coming off of several outstanding years, in which he has posted well above average for his investors. He seems to be winning his mud wrestling match with Bill Ackman by being temporarily, at least, proven right on his HLF investment, much to the detriment of Bill Ackman's short position. More importantly, all of these successes have been extremely public in nature. He is confident to no end. And the market is giving his advice regarding potentially lucrative investments a warm massage and a serving of steak tartare, in the form of premiums that immediately come into the marketplace whenever mention is made of a Carl Icahn investment.
With AAPL he has been especially public, taking to Twitter in order to communicate his enthusiasm. Using phrases like "no-brainer" to describe the AAPL investment, that in turn makes those who choose to follow Icahn into hormonal teenagers, clenching their hands together while crying beneath him in horn-rimmed eye glasses and velvet mini-skirts. AAPL is, arguably, the most popular public company out there today. And Carl Icahn is one of the most popular investors of our generation. This combination of the most popular company with one of the most popular investors feels much too much like Icahn's "I am a Greek god" moment. It has all the makings of a spectacular dive that has no choice but to go wrong.
Just look at those who have recently come before Icahn in soiling themselves both in front of the public and often times on the public, as investors of all pedigree are only too happy to hop on the love train.
John Paulson became a hero with subprime CDS. He was an investor that was to be followed. His form 13-F (for those of you unfamiliar, this is the SEC form that fund managers are required to file quarterly showing current holdings) became a biblical account of how one's portfolio should be structured. He subsequently falls flat into a sea of mediocrity that he is still attempting to escape.
Bill Ackman who, I believe, is unjustifiably labeled as Wall Street's pet goat currently, rode high with his investment in GGP. Making greater than a 1000% return on any investment immediately makes you into a Wall Street prophet of sorts. His opinions were and still are market moving. However, he has been tainted to a certain degree by ill-advised bets on JCP and TGT.
Every few years there is a new basket of popular institutional investors who go from totally sheikh to totally geek in the public eye. What makes me believe this is Icahn's moment is not only my negative opinion of AAPL, but the way in which Icahn is so openly assertive in his opinion AND how eager the public is to devour such an opinion on AAPL. It has all the makings of a "stock market hates you" moment in time, where the market reverts to its true nature of openly despising those who attempt to pick seemingly low-hanging fruit from its gnarled branches.
This is Carl Icahn's moment in time to travel down a path that is currently being occupied by the person he seemingly despises the most. What comes out the other side will be a reversal of roles that has not only has Carl Icahn shaking his head, but also the investors who choose to follow him in the "no brainer" investment that is AAPL.
