Apple's iPhone 5 starts strong in China but shares pressured
(Reuters) - Apple Inc sold more than 2 million iPhone 5s in China in just three days after its launch there on Friday, its best ever smartphone launch in the country, but Apple shares fell on Monday after Citi downgraded the stock.
The highly anticipated release in China, Apple's second-biggest market, has not eased worries about stiffer competition in mobile devices that has driven a slide in the share price of the world's most valuable technology company.
Jefferies analyst Peter Misek said last week that Apple had started cutting orders to iPhone suppliers to balance excess inventory.
Sales of Amazon.com Inc's cheaper Kindle Fire tablets have also surged this year and rival Microsoft Corp recently forayed into the market with its Surface.
Apple shares have fallen on seven of the last 10 trading days, with several analysts cutting their price targets on the company's stock.
The shares were down 1.3 percent at $502.76 in early trading on the Nasdaq. The stock has shed nearly 13 percent of its value since the beginning of this month to Friday's close.
Citi Research downgraded Apple's stock on Sunday to "neutral" from "buy", and lowered its price target to $575 from $675, citing diminishing hype around the iPhone 5 and improving competition in smartphones.
But Topeka Capital Markets remained upbeat, suggesting Chinese iPhone owners would upgrade from iPhone 4 models.
"The strong iPhone 5 sales this weekend support our view," Topeka Capital Markets analyst Brian White said in a research note on Monday. Continued...