iphone user

It’s no secret that Apple has fallen out of the good graces of most Wall Street analysts. And with its stock price still bouncing around $250 below its last-September high, and no new products on the horizon, it doesn’t look like that’s going to change anytime soon.

I wouldn’t say Apple’s in trouble though. It’s coming off a record high quarter in iPhone sales, revenue and other metrics, and has more than $130 billion in cash. But the folks over at the prestigious Barclays firm say that it’s about time for Tim Cook to panic…

Barclays analyst Ben A. Reitzes sent out a note to investors this morning (via BusinessInsider) entitled ‘Samsung Momentum Begs An Answer From Apple.’ Reitzes says that Apple must expand its iPhone market this year in a big way, or risk falling way behind.

“To say that the Samsung momentum is an issue for Apple is an understatement,” Reitzes said. “Not only is Samsung helping its own cause, but it catalyzes Android as well. As a result, we need to see Apple expand its iPhone market this year in a big way — and improve its platform in 2013.”

Samsung is expected to announce a new flagship handset, the Galaxy S IV, next month, which has already created a fair amount of buzz. And, in addition to its release, the company is also presumed to drop the price on its already popular Galaxy S III handset.

So with Samsung having top-notch offerings in both the low-to-middle and high-end markets, Reitzes doesn’t think Apple’s current iPhone lineup can hang, without making some major changes. Thus, he suggests it release a budget smartphone, and revamp iOS.

Now, we’ve heard multiple rumors in the past month that Apple is planning on releasing a less expensive iPhone this year. Recent reports suggest it’ll be made of metal and plastic, cost less than $300, and we’ll see it, alongside an iPhone 5S, this summer.

But does Apple need the budget iPhone to survive? No. It’d be nice for the folks in emerging markets, which are dominated by prepaid, who don’t get the luxury of subsidized smartphones. But Apple’s survival is not contingent on whether or not it makes a cheap phone.

That being said, I will say that I agree with Reitzes’ other statement, that Apple needs to improve its platform. Looking, for the most part, like it did back in 2007, iOS is more than overdue for a makeover. Here’s hoping Apple has cooked up some cool stuff for iOS 7.

What do you think?