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The financial management and advisory company said that although Apple's recent performance has been extraordinary, there are question marks over the effect of the imminent transition to Intel-based hardware.

Analyst Richard Farmer said that some consumers are likely to delay purchases until the Intel transition, offsetting the rise in Apple sales as a result of the 'halo effect' generated by the success of the iPod. He also thinks that the release of Microsoft's

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latest Windows incarnation, Vista, in 2006 may convince some computer users to stick with their PC rather than switch to a Mac.

Farmer also expects iPod sales to peak in 2007.

Apple's share price reached another high this week, peaking at $54.56.

The company's response to the iPod nano screen problems has been well-received by some investors.

'For a company often criticized for having an adversarial relationship with customers seeking product support, Apple's forthright offer to replace any faulty iPod nano is a smart and sensible move,' Apple investor Nathan Parmelee writes on the Motley Fool website, 'It's also an attitude I believe the company needs to embrace as it becomes more of a consumer electronics company and less of a computer company. Investors should certainly cheer it.'

Despite such enthusiasm, the initial response from investors was to offload stock. Apple's share price fell by almost five per cent yesterday before recovering towards the end of trading.