Analyst: Apple iPhone 5, game over

Is this a bearish formation?

Following a downgrade of Apple's shares by Citigroup, shares of Apple's suppliers are dropping sharply Monday morning. One analyst by the name of Jeff Pu, who works for Taipei-based Fubon Financial Holding Co., told clients that "The most important message is ‘iPhone 5 is game over,’ as demand appears to be weaker than expected -- i.e., US peaking, China launch just so so." Earlier Sunday night, Apple CEO Tim Cook raved over the 2 million units of the Apple iPhone 5 sold in China over the weekend. Cook said it was the largest launch weekend sales figure for the device in the country.

On Monday, Citigroup analyst Glen Yeung downgraded Apple to neutral from buy, which is Wall Street-speak for "sell". He reduced his target on the stock to $575 from $675 after supply chain checks showed that Apple was cutting orders which Yeung says raises questions about the strength of the Apple iPhone 5.

Foxconn parent Hon Hai Precision is down 5.5% on Monday to lead the drop in Apple suppliers' stock prices. Apple's shares declined 3.79% on Friday and is poised to open lower on Monday morning on NASDAQ as well. On December 5th, on fears that the Nokia Lumia 920T being offered on China Mobile would replace the Apple iPhone 5 in popularity in China, Apple's shares dropped 6.4% or $35 billion. That was the steepest drop in any U.S. stock since 1988.

Other analysts have said that Apple has lost a step or two. Check out some of those comments below. 

"Apple is still a very popular product but it’s not breaking massive records like it would have two years ago. Apple is losing its luster. It’s not the prestige status symbol it once was, and it’s not the market leader any more for high-end smart phones."-Shaun Rein, managing director,China Market Research Group

Apple "is losing some steam as it’s no longer leading the innovation and the competition is closing in quickly and sometimes are ahead of Apple in hardware specs. We’ve observed some serial iPhone users, people that have used several iPhone models, start switching to Android devices, indicating the company is losing some of its loyal users."Sandy Shen, Gartner

source: Bloomberg

UPDATE: In pre-market trading Monday morning, Apple is below $500 at $499.01 bid-$499.82 offered.