Apple Inc. (NASDAQ:AAPL) Turns Higher After Opening Lower, Above $650

The shares of Apple Inc.(NASDAQ:AAPL) have bounced back from early morning’s low and were recently trading at $659.39, up 0.51%, well off session low of $648.11. Yesterday, the stock ended lower for the first time in the past four trading sessions and retreated almost 3% from its life time high of $674.88.

So what could be the reason behind yesterday’s Sudden Retreat?

Holding a contrarian view is the way to instant fame, especially when the subject of the contrary opinion is Apple, a company whose stock has been hitting fresh highs to become the most valuable company.

A little known research firm Oracle Investment Research downgraded Apple to Hold from Buy, arguing that the hype around the stock was worrisome.

Can AAPL Hit $1000 By This Year? Find Out Here

On Tuesday, shares in Apple had scaled a new high of $674.88 in mid-day trades but quickly reversed their gains after the downgraded started trending on Twitter.

“The hype concerns us,” Oracle’s Laurence Balter wrote in a note to clients, likening the frenzy over the Apple stock (that took it past Exxon Mobil in market valuation) to what was witnessed years ago with Microsoft and Cisco Systems when they ruled the stock markets.

He cut his price target to $650 from $670.

apple's intention of entering the television segment with a TV-like device for live streaming content did not meet with the approval of Balter, who said that the low margin television business was "fraught with margin danger."

Oracle's downgrade has caught everyone by surprise especially as it comes at a time when all of Wall Street is bullish with the expected launch of its new iPhone around the corner along with upgraded and newer version of its other devices.

Jefferies Group raised Apple's target price to$900 while some others have predicted the share price would rise above $1000 by the end of this year.

Overhype has been the bane of Wall Street analysts and Oracle, though not a frontline research outfit, strikes a note of caution in a climate of feeding frenzy over the Apple stock.

Get Live Updates On AAPL Here

A stock has overheats in a very short span of time has to be watched carefully. However in the case of Apple, the rise in price has come at comparatively cheaper valuations.

It is still trading at 14.8 times its forward earnings.