Jeff Gundlach: Apple is Broken, Over-Owned Stock

Jeff Gundlach, founder of Doubleline Capital, appeared on CNBC Wednesday evening to give his take on Apple

. Gundlach specializes in bonds, but his bearish Apple call has gotten him a lot of coverage. Gundlach recommended that investors short Apple last spring when it was trading near $600. In his appearance Wednesday, Gundlach was as bearish as ever, calling Apple a “broken” stock that was “over-owned.” He reiterated his prediction that Apple would fall to $425. He said that he wouldn't consider Apple cheap until it was in the $300s. Gundlach refuted a number of the Apple bull arguments. Specifically, on Apple's low PE, Gundlach pointed to the company's large cash pile. Given that Apple's cash pile represented more than one-fifth of the company's value, it really shouldn't be a surprise that it trades at a low PE -- the multiple given to cash should be zero. In after-hours trading, Apple shares dropped nearly 10 percent, trading around $463. Apple closed at $514 on Wednesday.