“We are looking at tax reform in the U.S, so there is going to be an opportunity probably later this year to do something with that cash pile, and do something more efficiently for shareholders and I think Tim may have missed that opportunity,” said Stephen Isaacs, Chairman of the Investment Committee at Alvine Capital, to CNBC Wednesday.
Share buybacks have been popular with tech companies in recent years, offering short quick-fire boosts to share price.
One example is Microsoft who announced in September last year that it was authorizing up to $40 billion in buybacks.
Stephen Isaacs argued that there is increased cynicism in the market about tech companies buying shares at elevated levels.
“I think generally speaking share buybacks shows a little bit of a lack of innovation, a little bit of a lack of sense of where they can invest money,” the investor said on air.
In a follow-up telephone call, Isaacs elaborated on why Cook should wait until Trump’s tax reform is in place and bringing cash to the U.S. from overseas is cheaper.
“Investors would rather see the cash reinvested into the business, a [further] increase of dividend or simply accumulate the cash, wait until after the tax deal and then distribute to shareholders,” he said.
