Shares of Apple rallied on Monday as the consumer electronics makers reductions to iPod and iPhone manufacturing were already reflected in its stock price, analysts said.

The company gained $3.97, or 3.16 percent to close Monday at $129.45.

Last week reports surfaced indicating that the Cupertino Calif.-based firm had cut both its iPod and iPhone build plans for the first quarter targeting a 60 percent quarter-over-quarter decline in units. Apple shed 5 percent of its market value that day.

Citigroup added Apple to its Top Picks Live list today however, saying though unit growth is likely to remain sluggish through the first half of 2008, he sees several significant offsets such as a robust PC build plan for the March quarter and recent introduction of the MacBook Air.

We believe that these cuts did occur and that March quarter iPod and iPhone build plans are both below the current sell-side consensus, he said.

Gardner also said he still sees a 3G phone announcement in the first or second calendar quarter, with additional carrier relationships in Europe.

The brokerage, which retained its buy rating on the company and has a target price of $212 on the stock, said it was comfortable with its above-consensus quarterly earnings view.

Citigroup expects Apple's earnings per share for the March quarter to beat consensus by 10 cents or more, while revenue is expected to come in line.

In afterhours trading Apple rose 17 cents, or .13 percent at 6:27pm EST.