On Tuesday Icahn revealed through a tweet that he holds a significant number of shares of Apple and that the company is extremely undervalued. Icahn further revealed that he had a positive conversation with Tim Cook and is looking forward to another round of talks with him shortly.

Icahn has acquired shares in tune of over $1 billion making him one of the biggest stakeholders in Apple. Though the investment is less than 1 per cent of the company’s total net market capital of $444 billion, the announcement did have a profound effect on the share prices of the company. The stocks rose by 4.5 per cent and close at $489.57 adding over $17 billion to Apple’s net worth kitty.

Apple back in April this year announced that it intends to return $100bn (£65bn) to its shareholders money by 2015 through a buying scheme as well as by raising dividends. Icahn is of the opinion that Apple’s stocks could again cross the magical $700 mark if the company goes ahead with buy back plans of $150 billion.

Taking a stand on the current prices of Apple’s stock, Icahn told The Wall Street Journal “we think it ought to be worth $625” even if the company doesn’t increase its earnings and that the stocks even if the company’s earnings stay the same and while speaking with Reuters he said that Apple “should trade at $700 a share” if he is successful in convincing the fruity company to go ahead with a $150 billion buyback instead of $100 billion.

Icahn’s statement holds significance in a couple of ways. First, he underscores the capability of Apple and Tim Cook in being successful and secondly, his huge investment instills faith in other investors about the stability of the future of Apple.

Over the course of last 11 months, Apple shares have fallen nearly 30 per cent after hitting a record high of $702 in September 2012.