John Paczkowski

Recent Posts by John Paczkowski

Einhorn’s Greenlight Capital Waiting for Next Apple Blockbuster

Einhorn_AppleApple’s brutal 17 percent share-price decline in the first quarter shook the faith of many an investor, but not that of Greenlight Capital founder David Einhorn.

Discussing Greenlight’s latest financials with shareholders on Tuesday, Einhorn said that Apple’s stock performance earlier this year had cost the fund dearly. “Our biggest loss in the first quarter came from Apple,” he explained. But that hit hasn’t caused him to rethink Greenlight’s position in the company — certainly not in the way you’d expect.

Indeed, Greenlight recently expanded its investment position in Apple. The reason? Einhorn is a big fan of the company’s new capital allocation plan, and he’s confident in its product pipeline.

“Our thesis remains that Apple has a terrific operating platform and that its loyal, sticky and growing customer base will make repeated purchases of a growing portfolio of Apple products,” Einhorn said, according to a transcript of his remarks. “Apple took a major step forward by issuing debt and announcing it will return $100 billion to shareholders over the next three years. This is a vastly more shareholder-friendly capital allocation policy, than where Apple stood a few months ago. We’ve added to our Apple position. Now, we just wait for the release of Apple’s next blockbuster product.”

Einhorn didn’t disclose the size of Greenlight’s Apple stake, or just how much the firm had added to it. But as of the fourth quarter it held some 1.3 million Apple shares. As of this writing, those shares are worth nearly $600 million.

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Nobody was excited about paying top dollar for a movie about WikiLeaks. A film about the origins of would have done better.

— Gitesh Pandya of comments on the dreadful opening weekend box office numbers for “The Fifth Estate.”