Icahn, whose wealth is estimated by Forbes magazine to be $US20 billion, said Apple "has the ability to do a $US150 billion buyback now by borrowing funds at 3 per cent".
"If Apple does this now and earnings increase at only 10 per cent, the stock -even keeping the same multiple currently -should trade at $US700 a share."
Icahn, who has a history of taking stakes in firms to seek shake-ups, is currently in a battle with Dell as he tries to stop the ailing PC maker from selling itself to founder and chief executive Michael Dell. Icahn has previously clashed with management at Yahoo!, Time Warner and BlockBuster.
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