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Apple shares slide on analyst warning

Shares of Apple Computer continued their downward spiral on Wednesday, falling $2.24 or 4.03 percent after one Wall Street analyst warned that the company is likely to guide below the Street's consensus for its fourth fiscal quarter.

Apple's Q4

"We expect Apple to guide revenue below consensus of $5 billion, likely in the $4.6 - $4.8 billion range with earnings-per-share (EPS) of approximately $0.50 versus the Street’s $0.52," Credit Suisse analyst Robert Semple told clients.

The analyst said he believes the Cupertino, Calif.-based company will use its fiscal fourth quarter, which ends in September, to reduce iPod inventories ahead of refreshed models that will debut in either September of October.

Apple's Q3

Apple, which will announce the results of its third fiscal quarter next week, is likely to announce solid gross margins of about 100 basis points (or 1 percent) above its guidance of 28.5 percent, Semple said.

"This is primarily due to the combination of further iPod component cost declines, specifically for NAND and HDDs, and a more profitable mix of Mac sales, with a slight offset due to slowing software sales," he told clients.

For the quarter, Semple expects revenue of $4.4 billion and EPS of $0.46, ahead of Apple's guidance of $0.39- $0.43 and the Street's consensus of $0.44.

The analyst expects overall Mac shipments will grow 16 percent quarter-to-quarter to 1.285 million units, which will represent market share gains as the company continues to roll-out its Intel-based Macs.

"We believe Apple shipped approximately 450,000 MacBooks compared to our initial estimate of 310,000," he noted.

On the other hand, Semple said the company's prolonged iPod product cycle will likely cause it to miss the Street's iPod unit estimates of 8.25 million by about half a million units.

"On a near-term basis, we expect the stock to remain highly volatile based on the short-term focus around the timing of upcoming product introductions and their varying degrees of success," Semple added. "However, longer-term we continue to believe the stock is attractively valued."

Credit Suisse maintains an "Outperform" rating on Apple shares with a 12-month price target of $90.