By Jonathan Davies

Billionaire investor and activist Carl Icahn has told Apple chief executive Tim Cook that the company's shares are "still dramatically undervalued" in an open letter.

Mr Icahn believes Apple's shares should be worth around $250 (£153), more than double their current value. This is the second open letter issued by the activist investor. That would mean the tech giant was worth $1.4 trillion.

In October, he told Tim Cook that Apple's shares should be worth around $200, but they have risen 25% since then.

"It is our belief that large institutional investors, Wall Street analysts and the news media alike continue to misunderstand Apple," Icahn wrote in the letter.

Mr Icahn, who owns 53 million shares or 1% of the company, has urged Apple to increase its share buy-back scheme to reduce the number of overall shares and increase their value. He forecast Apple to post a profit of $12 per share in 2016 and says shares should be worth 18 times more than earnings.

Last month, Apple said it would increase its share buy-back programme from $130bn to £200bn.