Shares of Apple (NASDAQ: AAPL [FREE Stock Trend Analysis]) bounced back in early trading on Wednesday, rallying nearly 2 percent to around $495. The moves comes in contrast to two price target cuts and a ratings downgrade.
Both Stifel Nicolaus and Bank of America cut their price target on the Cupertino tech giant. Bank of America reduced its price target from $720 to $630; Stifel lowered its price target from $825 to $725.
Pacific Crest went a step further, downgrading the company to Sector Perform from Outperform.
Once again, the analyst community appears to be playing catch up to the market. It's easy to cut the company's price target after shares have dropped from over $700 to below $500 -- a nearly 30 percent decline in only a few months.
The selloff in Apple that began in late September may have been prompted by investors looking to avoid higher capital gains taxes ahead of the fiscal cliff. Then, fundamental concerns arose when analysts began to talk of iPhone supply cuts and Walmart (NYSE: WMT) offered the phone (the driving force behind nearly two-thirds of Apple's profit) at a significant discount.
At any rate, investors will get a look at Apple's fundamental business when they report earnings a week from today.
Shares of Apple traded at $496 on Wednesday.
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