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This Apple Bear Just Changed His Tune

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Apple (NASDAQ: AAPL  ) has been undergoing quite a bit of change recently, most notably with its $100 billion capital return program and $17 billion bond offering. Turns out that the Mac maker isn't the only one in transition -- one notable Apple bear is also having a change of heart.

Doubleline Capital CEO Jeff Gundlach was on record numerous times last year questioning the Mac maker's valuation and prospects. A year ago, he played bear to David Einhorn's bull at the Ira Sohn Conference, recommending that investors short Apple and go long natural gas at a time when shares were trading around $530. This was before climbing up to $705. After peaking in September, Gundlach predicted that Apple would fall to $425. I wondered if he'd ever be right.

Well, he was right. Absolutely right -- and then some. With Apple going as low as $385 last month, Gundlach nailed it. However, Gundlach's no longer an Apple bear, appearing on CNBC recently. To be clear, Gundlach maintains that he's not an Apple bull, either, even if he did have some generous things to say. He's remaining on the sidelines now. He has since closed out his short position, presumably with a handsome profit.

His initial short thesis was predicated on the idea that Apple has lost momentum with product innovation at a time when it was over-owned. Nowadays, he concedes that shares are incredibly cheap, especially when looking at its earnings multiple excluding cash, which is in the neighborhood of 6 to 7. A lot has happened over the past year, including adding over $34 billion in cash while trailing-12-month earnings are up modestly.

He calls it cheap, but says he's "not positive or negative" but has instead "moved on." If he had to take a position though for the next six months, Gundlach says he'd rather be long than short.

Gundlach made headlines for accurately calling Apple's drop, and while he says he's mostly neutral, you can't help but think he's now a little bullish based on his comments.

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