Jeff Gundlach, considered the bond guru by many, has had some good equity calls lately. Gundlach said Apple is worth $425, but this was months ago when the stock was making new all time highs. At the time he appeared crazy, but now he seems to have had the best call. Jeff Gundlach calls the company broken and thinks that it could be worth less than $300. Gundlach made this comments in a CNBC interview which aired yesterday, the video is embedded below, along with a computer generated transcript:
(No position in Apple)
in terms of the trade, 425, do you think that will come sooner than you thought at this point? well, i think it’s coming this year for sure. that’s an awfully long time window, i realize. i think the way it’s looking now, it should probably happen this quarter. i mean, listen to people talking about apple. i’m still impressed with the obsession that people have with, do i buy it now that it’s down a little bit, institutional hands, have they told is it, do they own it, this is not the type of talk that goes on at a real enduring bottom in an asset class or stock. i think it trades incredibly badly. and in the very short term, i don’t know where the stock is this very second. i know it was down pretty sharply, town to about 486 or so. last i saw it. but the intraday low is 483. i think if you take that out and certainly if you close tomorrow at 483, you’re going to see 425 very, very quickly. the best thing apple has going for it is it’s lost some of its down side momentum. last time we spoke, me list, was november 16th and we talked about how risk asset stocks, probably start to catch a bit. and maybe bond yields, short term — all those things have happened. it seems that so many things have had a nice rally from there. apple isn’t among them. but i really think it’s time to be hooking for corrections across the board in all those things. the same type of reversal to the upside, we talked about november 16th, i think you’ll be looking at reverseals to the down side since then. and a decrease, believe it or not, in long term bond yields once again of the. jeff, you made this call in the sharp run higher apple saw up to 705 or 707 or so and you said when you see something go up that quickly, you want to short it. but what is a fundamental story? is there a point at which you would go along apple if it hit that 425 mark, is that fairly valued in your mind? i really think it’s ultimately going through that number. i think this is really a broken company that’s incredibly overowned. again, the fact that we’re talking and across the board in the media so much about this indicates that it’s still very, very in the forefront of investors’ psyche. and i don’t think bottoms happen with that type of sentiment. fair value? i think 425 represents fair value but since when do broken asset classes and stock stop at fair value? you know, someone is just mentioning while i was waiting to come on air about this huge cash position. you know, that doesn’t exactly argue for a huge multiple.