Carl Icahn says he's taken a position in Apple, says stock undervalued

Billionaire investor Carl Icahn revealed on Twitter that he's taken a "large position" in Apple.

"We believe the company to be extremely undervalued," Icahn said Tuesday. Icahn's investment in Apple is worth over $1 billion, the Dow Jones reported.

Apple stock spiked as much as 5.69 percent on the announcement and closed up 4.75 percent, making it the iPhone maker's second best day of the year. (Click here for the latest Apple quote)

While Apple is now up over $100 from its 52-week low of $385.10 hit on April 19, it remains down about 8 percent for the year.

Icahn said he spoke with Apple CEO Tim Cook about the company launching a larger buyback and that the two plan to speak again. A buyback is a "no brainer" for Apple, Icahn told CNBC on Tuesday. It would enhance the stock value tremendously, he said.

In a statement, Apple said, "We appreciate the interest and investment of all our shareholders. Tim had a very positive conversation with Mr. Icahn today."

Icahn's disclosure comes one day before the deadline for large investors to disclose their second-quarter holdings.

Ichan's bet that Apple is largely undervalued comes right before the company is about to make significant product launches, said Gene Munster, an analyst for Piper Jaffray.

(Read more: When to expect Apple iPhones, iPads, iWatch and iTV )

"The next year is going to be a big year for Apple and he probably thought he might as well hold this meeting before that," Munster said. "There's the investor side of it, which is to own the stock before the product cycle, and there's the activist investor side, which is probably to increase pressure to do a buyback."

Ichan's news comes one day after a report that the company will be launching its next generation iPhone, the iPhone 5S, on Sept. 10.

(Read more: Apple sets iPhone launch date, Wall Street says buy now )

"My guess is he is probably playing through the end of 2014. But with the new products, the stock would have gone up regardless," Munster, who has an overweight rating on the stock with a $655 price target, said.

Although Icahn is pushing for a larger buyback, it's likely it won't take place until March, Munster said. And while Icahn has the power to make an impact on increasing shareholder dividends, his power over changing the company is somewhat limited, Munster added.