Tags: Barclays | Reitzes | downgrades | Apple

Barclays Analyst Reitzes Downgrades Apple Shares

By    |   Thursday, 20 February 2014 04:09 PM

Barclays Capital analyst Ben Reitzes cut his rating on Apple shares to equal weight from overweight Wednesday, saying he's unimpressed with the company's new products.

"Frankly, we just couldn’t quite bring ourselves to use smart watches or TVs as reasons to raise numbers, nor were we fully convinced that these products could move the needle like new categories did in the old days," he wrote in his downgrade report, obtained by Barron's.

The iPhone remains the company's core, Reitzes says. "New categories seem to be designed to make the iPhone more useful, but don’t necessarily reaccelerate growth in the iPhone category to sustainable double-digit levels."

Reitzes compares Apple to Microsoft, whose stock hit its record high in late 1999, when the company held a dominant position in the personal computer/Internet world.

Apple's stock peaked in September 2012, when the company held a dominant position in the mobile communications sector, Reitzes writes.

"The most dominant tech leaders of their era don’t necessarily just regroup from these types of peaks and reassume a new all-time high market-cap after a year or two," he wrote. "They may get usurped in the ensuing decade or two."

Apple fell 1.2 percent to $531.05 Thursday. Reitzes maintained his $570 price target.

Morningstar analyst Brian Colello offers a tempered endorsement for the company.

"Although Apple has a sterling brand, robust product pipeline, and ample opportunity to gain share in its various end markets, short product life cycles and intense competition will prevent the firm from resting on its laurels or carving out a wide economic moat," he writes on Morningstar.com.

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Barclays Capital analyst Ben Reitzes cut his rating on Apple shares to equal weight from overweight Wednesday, saying he's unimpressed with the company's new products.
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2014-09-20
Thursday, 20 February 2014 04:09 PM
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