Shares of Apple Computer ( AAPL) were off 3% on Wednesday after an analyst lowered his price target on the stock and predicted the company would delay releasing updated versions of some of its iPod music players.

Analysts have been expecting Apple to update its top-of-the-line video-playing iPod and its flash memory-based iPod nano models before the holiday season this year.

But Apple likely will release the new nano about a quarter later than expected this year, and probably won't release the new video iPod until sometime next year, American Technology Research analyst Shaw Wu said in a research note on Wednesday. Technological changes to both devices are prompting the delays, he said.

Wu didn't change his earnings or revenue estimates, citing strong sales of the company's current video iPod. But he lowered his price target on the stock to $75 from $101 to reflect higher risk and the market's recent selloff.

Apple's "stock looks attractive and we believe lower expectations are priced in," Wu wrote in the report. AmTech doesn't do investment banking.

An Apple representative did not return a call seeking comment on Wu's report.

Despite Wu's residual bullishness, the market sold off Apple shares on the news. In recent trading, the company's stock was off $1.77, or 3%, to $55.66. Earlier in the session, the stock was off as much as $2.02, or 3.5%, to $55.41.

Apple has resurrected its fortunes with the iPod. The various iPod lines together dominate sales of digital music players in the U.S. and hold the top market share worldwide.

The company has established its lead in part by continually refreshing its lineup, adding new features and remaining competitive on pirces with its rivals. Indeed, the company has kept a brisk pace, either updating old models or introducing new ones two or three times a year for the past several years. Last year, for instance, the company introduced its low-end iPod shuffle in January, added video playing features to its high-end iPods in the fall and about the same time replaced the hard disk-based iPod mini, its most popular model at the time, with the iPod nano.

But the company seems to be bumping up against technological constraints, Wu said. On the nano line, Apple is planning to change chips and architecture from a system made by PortalPlayer ( PLAY) that solely plays music to one potentially made by Samsung that can play both music and video, Wu said. Difficulties inherent in making that transition will likely push out the launch of the updated nano from the third quarter this year to the fourth quarter, he said.

Meanwhile, Apple has been widely expected to launch a new video-playing iPod that includes an LCD screen about twice the size or more than the one on current models. But Apple also wants to increase the battery life of the model, a contradictory goal since larger screens consume more energy. As might be expected, trying to meet both those goals at the same time has proved difficult, Wu said.

The company likely has tried to fix the problem by including a bigger battery, developing better software to manage battery life and developing a hybrid drive system that includes both a hard drive and NAND flash, which consumes less energy than hard drives. The attempt to find a solution will likely delay the launch of the new iPod from the fourth quarter of this year until sometime in the first half of next year, Wu said.

Ironically, the delay may actually help Apple, he said. By releasing both the video iPod and the nano last fall, Apple boosted fourth-quarter sales. But at the same time, the moves tapped out its short-term development efforts, forcing the company to delay the release of new or updated models, Wu said.

"For these next-generation iPods, we believe AAPL will likely pursue a strategy with refreshes in a more linear fashion," he said.