A note of caution is beginning to chime on Wall Street in regard to Apple's share value, as investment advisors consider the potential impact of competing music services and players on its future fortunes.

Smith Barney analyst Richard Gardner yesterday raised his 2005 and 2006 earnings estimates and price targets for Apple, but lowered his rating on the stock to 'Hold', rather than his previous 'Buy' recommendation.

Gardner warned that because Apple's stock value has doubled in the last four months he couldn't "justify more than a $75 fair value in twelve months". He predicts 2005 earnings of $1.75 per share, and a price target of $75 (from $60).

Profit-taking begins

And in related news this morning, Business Week asks how long Apple's iPod will remain the dominant music player, citing Standard and Poor's (S&P) warning that new devices from other companies, particularly Sony, may threaten Apple's fortune.

S&P analyst Megan Graham-Hackett warns that Apple's present stock price may already include a most of its iPod-driven revenue gains. She also warns that the March (second) quarter is traditionally a weak one for Apple.

CNN Money senior reporter Paul La Monica yesterday wrote that, "it makes sense for investors to cash in on gains". He advises caution in this: "There's a happy medium. You can sell some but you don't have to sell all of it".

He spoke with several fund managers to discover that many of these have begun selling some of their Apple shares to liquidise the gains they've made.

"If you've been fortunate enough to make some money from a stock that has more than tripled in less than a year, the smart thing to do is to take some profits," he wrote.

Al Frank fund manager John Buckingham, however, "sees nothing shaky about Apple's outlook", but is concerned that optimism surrounding the company's stock may skew its share price to exceed its value.

Richard Skaggs, co-manager of the Loomis Sayles Growth fund told CNN: "I'm convinced Apple's still a great story but at this price we need more evidence about how strong the December quarter will be."