Icahn makes $800m profit from Netflix share sale

The 77-year-old Icahn acquired close to a ten percent stake in Netflix at an average of $58 a share and has made a 457 percent return after selling three million shares at a peak of $341.44. The sale saw 2.4m shares sold for close to $819m, bringing in $645m profit on that day alone. The other 600,000 shares were sold in the twelve preceding days.

Netflix is currently the leading video streaming service in the world

“As a hardened veteran of seven bear markets I have learned that when you are lucky and/or smart enough to have made a total return of 457 percent in only 14 months it is time to take some of the chips off the table”, said Icahn.  Speculation about Icahn cutting almost half of his stake caused the Netflix share price to plummet by nine percent to $322.53 a share at the end of trading on Tuesday.

Netflix is currently the leading video streaming service in the world and has been named the number one performer in the Standard & Poor’s 500 Index this year. Brett Icahn, co-manager of the $4.8bn Sargon Portfolio that that oversees the stock, wished to keep a substantial stake in the business despite his father wanting to sell while the share price was high.

In a statement released by Sargon co-managers, David Schechter and the younger Icahn, Netflix was referred to as being “significantly undervalued”. They said: “As a subscription service priced at only $7.99 per month, we believe Netflix is one of the great consumer bargains of our time.”

In a the press release and Tweet  issued after the sale on Tuesday, Icahn thanked Netflix CEO Hastings, Netflix Chief Content Officer Sarandos and Kevin Spacey, one of Netflix’s lead actors. Icahn’s firm Icahn Enterprises is estimated to own assets valued at around $29bn.