Wall Street analysts have different opinions about Apple's share performance in 2014. Brian White, an analyst with Cantor Fitzgerald has a positive outlook for Apple, while Maynard Um, an analyst with Wells Fargo, has downgraded Apple's share rating.
Both firms recently issued a note to investors providing their assessment as to why investors should or should not buy Apple's shares in 2014.
White expects that Apple will diversify its product range with the launch of a wearable gadget, such as an iWatch. The analyst also predicts that the company may launch a bigger iPhone this year. Rumors are also circling that Apple may launch a 12.9-inch iPad. However, White expects Apple to launch a 12.9-inch hybrid device bigger than the iPad Air but more mobile and portable than a MacBook Air.
White is also optimistic about the Apple and China Mobile deal, which is expected to generate additional revenue for the company. China Mobile will start offering the iPhone 5s and the iPhone 5c from mid-January. Cantor Fitzgerald estimates Apple share price to reach $777 in 2014.
"For 2014, we expect Apple to enter new product categories, re-accelerate growth in China and deepen its offerings in existing categories," said White.
Although White has a positive outlook for Apple in 2014, Um of Wells Fargo has downgraded Apple's share rating from "outperform" to "market perform."
Um says Apple may launch a completely redesigned iPhone 6 this year, which will cut the profit margin of the handset. Well Fargo observes that gross margin increases when Apple releases an "s" version of the phone, such as its recent iPhone 5s, while the gross margin decreases when the company releases an iPhone with a new form factor.
Um is also concerned about Apple's ability to hold on to its market share in highly competitive markets such as the smartphone and tablet space.
The Well Fargo analyst also thinks that there may be a shift of power in 2014 from producers such as Apple to big carriers like AT&T and more. The analyst firm has estimated Apple's share price to be in the range of $536 and $581.
Apple's share price fell by $12.15, or 2.20 percent, and closed at $540.98 on Friday, January 3.
On Monday morning, Apple shares were trading 0.13 percent down at $540.26 on the Nasdaq.
