Citigroup Downgrades Apple

| Apple Stock Watch

Citigroup analyst, Richard Gardner, downgraded his rating on Apple stock from "Buy" to "Hold," citing Appleis current iPod lineup as cause for concern. He feels that Appleis updated video capable iPod, iPod nano and iPod shuffle comprise all of the companyis new offerings for the holiday season, but investors wanted more, according to BusinessWeek.

Mr. Gardner commented "This is likely to disappoint some investors who are still expecting at least one more new product before the peak holiday selling season."

He also predicts that when Apple releases it cell phone - most likely in first quarter or early second quarter of next year - it wonit be available in large quantities. Appleis "iPhone" is also likely to see limited sales in the U.S., and will be relatively expensive, he thinks.

Mr. Gardner is expecting Appleis revenue growth to slow, as well. He is looking for 37 percent growth for fiscal 2006, 20 percent growth in 2007, and 12 percent in 2008.

Apple stock is currently trading at US$74.68, down 2.30 (2.99%).

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