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Apple Stock Heading to $500: Gundlach

First revered and then reviled, shares of Apple have farther to climb and could handily reach $500, DoubleLine CEO Jeffrey Gundlach said Tuesday.

"Apple seems to be forming a base to me. I mean, it certainly moved down in a way that was frustrating for investors that were long, and it seems to have a hard time rallying above $450, but I think it's going to," he said.

Apple stock gained 45 cents midday, trading at $451.32.

(Read More: Apple Stock Price Bottom May Be In as CEO Tim Cook Steps Up)

On CNBC's "Fast Money," Gundlach, who was previously neutral on the stock, said that he owned shares of Apple below $425.

(Watch Video: Gundlach on Apple: 'I'm Not Positive or Negative')

Gundlach also noted a sort of market overreaction with Apple.

"It just one of these stocks that was so revered, therefore over-owned in the summer of last year, and then it becomes sort of this reviled sort of stock, which I don't think is right, either," he said.

(Read More: Leon Cooperman's Winning Apple Stock Play)

"All of the fundamentals that people talk about now as being a reason why Apple may not have the growth they had in the past, all of those fundamentals were crystal-clear a year ago. It's just an amazing study in market psychology."

Gundlach said Apple would hit $500 per share, calling it a "fairly easy place" for it to reach after its climb to $705 in September and subsequent drop to the $380 level in April.

(Read More: Apple Stock Valuation 'Crazy': Ex-CEO Sculley)

"It just seems to me to be too cheap vs. a lot of other stocks, given their cash-flow engine that they have," he said. I'm not so sure that we're ever, ever going to see $700 again in Apple, at least in the context of markets where they are today."

Trader disclosure: On June 4, 2013, the following stocks and commodities mentioned or intended to be mentioned on CNBC's "Fast Money" were owned by the "Fast Money" traders: Joe Terranova is long VRTS; Joe Terranova is long SJM; Joe Terranova is long AAPL; Joe Terranova is long SPLK; Joe Terranova is long GLD; Joe Terranova is long TBT; Joe Terranova is long SWN; Joe Terranova is long GOOG, $870 PUTS; Joe Terranova is long GS, $165 PUTS; Steve Weiss is long LCC; Steve Weiss is long BAC; Steve Weiss is long C; Steve Weiss is long F; Simon Baker is long AAPL; Simon Baker is long C; Simon Baker is long CSCO; Simon Baker is long YHOO; Simon Baker is long FB; Simon Baker is long GOOG; Simon Baker is long EBAY; Simon Baker is long PCLN; Simon Baker is long GM; Simon Baker is long VIAB; Josh Brown is long AAPL; Josh Brown is long DD.

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