A short squeeze is driving Apple stock higher after the company's record quarterly earnings performance reported on Tuesday, activist investor Carl Icahn said on Wednesday.
"I think you have an ad hoc short squeeze that has occurred and is occurring now in Apple," Icahn told CNBC's "Fast Money: Halftime Report."
Apple shares rose more than 7 percent into Wednesday afternoon after the tech giant on Tuesday easily beat Wall Street expectations on record quarterly earnings and revenue. Better-than-expected iPhone sales and strong growth in China helped push the monster quarter. The company also announced it would ship its wearable Apple Watches in April.
Despite a potential short squeeze, Apple's true value remains much higher than its current price, Icahn argued. He said he is "very pleased" with the company's results and continues to recommend the stock.