Analysts at Merrill Lynch today reiterated their 'Buy' rating on Apple stock.

AFX UK reports the analyst said this reflects good performance in the higher education market, and cites the iPod 'halo' effect and brand recognition.

"The company's earnings could have upside due to European Music Store sales and international iPod sales," the report says.

Piper Jaffray also spoke up today, saying Apple's Music Store could drive Apple's shares in 2005 and 2006. It said investors are "underestimating" the impact on Apple's business, and that the company's own attempts to minimize expectations of its music initiatives also dampens expectations.

"As overall demand for digitally-distributed content increases, we expect the Street to begin to vies iTunes as more than just a cog in the wjeel that drives hardware sales," the analysts said.

Apple shares have begun exchanging on the pre-trades market.