NEW YORK Oct 1 Shares of Apple Inc. rose about 2.5 percent on Tuesday on news that billionaire activist investor Carl Icahn had dinner with Apple chief executive Tim Cook on Monday and "pushed hard" for a share buyback.
"Had a cordial dinner with Tim last night. We pushed hard for a 150 billion buyback. We decided to continue dialogue in about three weeks," Icahn tweeted on Tuesday.
In August, Icahn told Reuters that "Apple has the ability to do a $150 billion buyback now by borrowing funds at 3 percent.
He also said at the time, "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."
Shares of Apple rose about 2.5 percent on Tuesday to trade over $488 a share.
Icahn told CNBC on Tuesday that his stake in Apple is worth around $2 billion and said Apple's chief financial officer Peter Oppenheimer also attended the three-hour-plus dinner meeting on Monday.
Greenlight Capital's David Einhorn, another billionaire activist investor and huge Apple shareholder, implored Oppenheimer last year to have the company issue dividend-paying preferred shares to reward investors and juice the stock price.
Einhorn told Reuters in February that Cook was more receptive to the idea than Oppenheimer, who had earned a reputation on Wall Street for extreme conservatism in cash management.
Apple has a history of remaining liquid by investing in safe but low-yielding U.S. Treasury and agency debt. The company shies away from big acquisitions and repeatedly preaches a capital preservation mantra to investors.
Cook did not mention the dinner in any tweets on Tuesday.