NEW YORK (AP) — Goldman Sachs is taking Apple off its list of most highly recommended stocks and lowered its price target, but kept a "Buy" rating for the company.

Analyst Bill Shope said in a client note that Apple Inc.'s most recent product cycle has not driven market share and new user growth as expected. He anticipates that the company, which is known for products like the iPhone and iPad, will need some "hits" among the products it rolls out during the second half of the year in order to push the stock higher. But Shope said that there's still uncertainty around the timing and potential impact of the products Apple is expected to launch.

Shope anticipates a less-expensive iPhone debuting around the third quarter, which could help drive growth in emerging regions. But the analyst said that specific features and pricing for the smartphone are not yet known, so it is hard to "give Apple the benefit of the doubt on this products success and financial impact."

The company may also be able to give itself a boost if it comes out with an iPhone with a larger screen, but Shope said that so far there's little evidence Apple is looking to roll out such a product near term.

"If this device is delayed until 2014, the company could face further competitive pressures in the high-end segment of the smartphone market in the second half of 2013," he wrote.

Last month Apple's chief rival, Samsung Electronics Co. revealed the Galaxy S 4. It features a slightly larger screen in a slightly smaller body than predecessor S III and includes several new ways of controlling the phone without touching it.

Many analysts have said that the main weakness of the iPhone 5 is that it has a small screen relative to high-end Android phones; the S 4 is 56 percent larger. Still, most analysts see the S 4 as an incremental advance for Samsung, but not a game-changer that's likely to deal a big blow to Apple.

Shope also said he's anticipating Apple "refreshing" its stable of iPad products, which could slow some of the cannibalization of the iPad mini. The analyst said the iPad mini has been more successful than he expected, and that this may permanently shift the iPad products toward this smaller form.

Shope believes that Apple will soon announce a new capital allocation plan. If the company announces a substantial dividend increase and or a stock buyback, it could provide "a healthy floor" for the stock price, he explained. Still, the analyst said that he thinks the stock's outperformance over the next 12 months "will be more closely tied to the timing and success of Apple's next batch of product refreshes."

Shope reduced Apple's price target to $575 from $660 and took it off the Americas Conviction list.

Nonetheless, Apple stock added $1 to $427.91 in premarket trading on Tuesday.

A call to Apple for comment was not immediately returned.